The GBP/USD pair remains in a corrective pullback that began after two "bearish" signals formed simultaneously: a liquidity grab (marked by the red line) and a reaction to imbalance 16. Essentially, over the past two weeks, the pound has traded within the "bullish" imbalance 19, failed to invalidate it, maintained a bullish bias, and continues to move within a narrow horizontal range. Thus, despite two weeks having passed, imbalance 19 has still not been invalidated, and no bullish signal has yet formed. It is possible that traders are waiting for the meetings of the European Central Bank, the Bank of England, and the Federal Reserve, while the pound may be waiting for the euro to begin a synchronized move upward. The bullish trend remains intact in both cases, so I expect its continuation and the formation of new bullish signals that would allow for opening new long positions. Bulls may also expect support from the Bank of England, as rising inflation could shift the regulator's stance to a more hawkish one than traders currently anticipate. However, I should note that over the next 24 hours, the pound's direction will largely depend on the euro and the dollar, not solely on the Bank of England meeting.
There is little else to add regarding the news background or technical picture at this time. The situation around resolving the conflict in the Middle East remains stalled, and traders are uncertain whether any efforts are even being made to organize a new round of talks between Tehran and Washington. The technical picture is simple and clear: either wait for a bullish signal or for the bullish pattern to be invalidated.
The latest rally in the pound began with a "Three Drives Pattern." Thus, traders received a bullish signal at the very start of the move, and the trend remains bullish. At present, the ceasefire is quite fragile, and the parties involved have yet to decide whether to continue negotiations or resume hostilities. Talks may resume, but so could the conflict. The Strait of Hormuz remains under a dual blockade, and Tehran and Washington have not even agreed on a second round of negotiations, let alone a comprehensive agreement to end the conflict. As of Wednesday, nothing has changed for two weeks. Both sides verbally express willingness to reach a deal, but in practice, no real steps are being taken.
The "Three Drives Pattern," marked on the chart with a triangle, allowed bulls to go on the offensive. Imbalance 18 gave traders an opportunity to open long positions, and imbalance 19 may offer another chance. Thus, this week we may see a third bullish signal within the current impulse. Bearish patterns and liquidity grabs are not causing any concern for bulls.
The economic news background on Wednesday was absent, and no new reports regarding a ceasefire or negotiations came from the United States or Iran. Iran believes it has put the ball in the U.S.'s court, while the U.S. believes the opposite. The pause continues, albeit without active hostilities. Meanwhile, the market is waiting for the Fed meeting.
In the United States, the overall news background suggests that, in the long term, little can be expected other than a weakening dollar. Even the conflict between the U.S. and Iran does not significantly change this. Geopolitics briefly reminded markets of the dollar's safe-haven status for about two months, but overall, the long-term outlook for the U.S. dollar remains challenging. The U.S. labor market continues to weaken, the economy is approaching recession, and the Fed—unlike the ECB and the Bank of England—is not planning to tighten monetary policy in 2026. In addition, there have already been four major protests across the U.S. against Donald Trump, and the departure of Jerome Powell could further complicate matters for the dollar (especially if, under Kevin Warsh, the FOMC adopts a more dovish stance). From an economic perspective, I see no grounds for dollar strength.
News calendar for the U.S. and the United Kingdom:
On April 30, the economic calendar includes six entries, with traders needing to pay particular attention to the Bank of England meeting and U.S. GDP data. The impact of the news background on market sentiment on Thursday is expected to persist throughout the entire day.
GBP/USD Forecast and Trading Advice:
For the pound, the long-term outlook remains bullish. The "Three Drives Pattern" warned traders of potential growth, followed by the formation of a bullish imbalance and a bullish signal. Price swept liquidity from bullish swings on March 10 and 23, as well as from the February 26 swing, but bears failed to initiate an attack in either case. This is another positive sign for the pound—traders remain in a bullish mindset. Therefore, despite geopolitical factors, I believe the upward movement will continue. Most likely, the euro will also continue to rise. I see the 2026 high as the target for the pound. The reaction to imbalance 16 triggered a corrective pullback, but the reaction to imbalance 19 may provide traders with a new opportunity to open long positions.
*La presente analisi del mercato ha un carattere esclusivamente informativo e non rappresenta una guida per l`effettuazione di una transazione.
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