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16.03.202611:07 Forex Analysis & Reviews: GBP/USD. March 16th. The Dollar Continues to Ignore the State of the Economy

Relevance up to 03:00 2026-03-17 UTC--4

On the hourly chart, the GBP/USD pair continued the decline process on Friday and by the end of the day was near the support level of 1.3199–1.3214. A rebound of quotes from this zone will work in favor of the European currency and some growth toward the resistance level of 1.3341–1.3352. A consolidation of the pair's rate below the 1.3199–1.3214 level will increase the probability of continued decline toward the levels of 1.3139 and 1.3016.

Exchange Rates 16.03.2026 analysis

The situation with the waves turned "bullish" for literally a couple of days. The latest collapse of the British pound has once again changed the trend to "bearish." The last completed upward wave broke the previous peak, but the new downward wave has broken the last two lows. The information background for the pound has been weak in recent months, while geopolitics has provided the bears with a full advantage in the market. The war in Iran remains the main reason for the growth of the American currency, and bullish traders do not see clear timeframes for the end of the conflict.

The information background on Friday, to put it mildly, did not support the American currency or the bears. Two of the most important reports on GDP and durable goods orders showed disappointing values, reflecting a slowdown in the American economy that could turn into a full-fledged recession. In the first week of the U.S. war in Iran, the American budget spent more than $20 billion. The surge in oil and gas prices will also affect American enterprises and American taxpayers. Thus, in the near future not only may the U.S. economy continue to slow down, but inflation may rise and the labor market may shrink. In my opinion, the dollar continues to grow exclusively because of geopolitical events in the Middle East, but this is no longer news or a revelation for anyone. In the near future, the countries of the European Union may try to independently negotiate with Iran to unblock the Strait of Hormuz, but whether the United Kingdom will be among them is unknown. Britain does not face energy issues as acutely, and its ties with the United States are much stronger and broader than those of the EU. The world continues to become more divided, and more countries believe that each state must deal with its own problems independently. At the moment, the dollar remains strong, but I do not believe this situation will last indefinitely. Trump is doing everything to lose the next election and end up under impeachment.

Exchange Rates 16.03.2026 analysis

On the 4-hour chart, the pair performed a rebound from the upper boundary of the downward trend channel, a reversal in favor of the U.S. currency, and resumed the decline toward the corrective level of 1.3145. Only a closing of quotes above the downward channel will allow traders to expect the completion of the "bearish" trend and growth toward the Fibonacci level of 0.0% – 1.3786. No emerging divergences are observed today on any indicator.

Commitments of Traders (COT) Report:

Exchange Rates 16.03.2026 analysis

The sentiment of the "Non-commercial" category of traders became more "bearish" during the last reporting week, which in the current circumstances no longer looks accidental. The number of Long positions held by speculators decreased by 10,229, while the number of Short positions increased by 1,282. The gap between the number of Long and Short positions is now effectively the following: 49 thousand versus 133 thousand. In recent months, bears have dominated more often, but the situation with contracts on the euro currency is directly the opposite. I still do not believe in a "bearish" trend for the pound, but now everything will depend not on economic indicators or Trump's trade policy, but on the duration and scale of the war in the Middle East.

Over the past year, the pound looked like a safer currency compared to the dollar. More stable and with a clearer economic future. However, in recent months a correction began while maintaining the "bullish" trend, and then the conflict in the Middle East began to flare up almost every day. Geopolitics remains the only reason for the growth of the American currency.

News calendar for the U.S. and the U.K.:

  • U.S. – Change in Industrial Production (13:15 UTC).

March 16 contains only one entry in the economic events calendar, and there is no hope that the market will pay attention to it. The influence of the information background on market sentiment on Monday may again be extremely weak or absent.

GBP/USD Forecast and Advice for Traders:

Sales of the pair were possible after a rebound on the hourly chart from the 1.3437–1.3465 level with targets of 1.3341–1.3352 and 1.3199–1.3214. All targets have been reached. New sales are possible after a closing below the 1.3199–1.3214 zone with targets of 1.3139 and 1.3016. Purchases are possible today after a rebound from the 1.3199–1.3214 level with a target of 1.3341–1.3352.

Fibonacci level grids are built from 1.3341–1.3866 on the hourly chart and from 1.2104–1.3786 on the 4-hour chart.

*Analiza tržišta koja se ovde nalazi namenjena je boljem razumevanju tržišta i ne pruža instrukcije za vršenje trgovanja.

Samir Klishi,
Analytical expert of InstaSpot
© 2007-2026
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