27.02.202604:13 Forex Analysis & Reviews: Overview of the GBP/USD Pair. February 27. The British Pound May Set an Example for the Whole Market

The GBP/USD currency pair has once again demonstrated a desire to continue its upward movement on Thursday, but the pound serves as a sort of refuge in the currency market. First, the British currency is still trading, albeit clumsily, rather than remaining stagnant. Second, there is a trend in GBP/USD—though it may not be strong—rather than a flat trend. The daily timeframe retains an upward trend that raises no questions during almost any corrections. On the 4-hour timeframe, we have seen a classic three-wave correction, and the price is now trending upwards. On the hourly timeframe, we have been observing upward movement for a week. Thus, we can conclude that the British pound, unlike the euro, is at least trading, moving, and forming understandable models, patterns, and structures that can be followed.

Naturally, as with the euro, we also expect only growth from the British pound. Not because the British economy is flourishing and the Bank of England intends to tighten monetary policy, or that there are no problems in the UK. On the contrary, Britain has been in a state of political crisis for 10 consecutive years, where one could confidently predict that the current Prime Minister would not finish his term. Now, with Keir Starmer at the helm, there is a sense of at least some stability. Last autumn, Britain struggled to resolve the dilemma of a massive hole in its budget. The BoE is lowering the key rate at a pace similar to that of the Federal Reserve. The UK economy seems to be pretending to grow rather than actually growing. But all these factors are practically irrelevant because the situation in the U.S. is much worse. And even worse are the prospects for the American economy.

It is worth noting that investors and traders like to think ahead. This approach guarantees maximum profit. Therefore, perspective is not an empty word; it is a very important concept for any market. What to expect from America and the dollar under Donald Trump? It seems this is already an ironically rhetorical question that only brings a sad smile to investors' faces. Experts have calculated that the first year of Trump's second term brought no significant achievements to America. The economy is growing more slowly than under Biden. The issues of the trade budget deficit were not resolved. The budget deficit problem remains unsolved. National debt continues to rise. American businesses, "for some reason," do not want to return home. The U.S. has sour relations with half the countries in the world—what for? What positive outcomes can we name from Trump's policies? Expulsion of illegal refugees? Victory of the American team at the Winter Olympics? Ending eight wars in the world, the names of which even experts cannot name?

Thus, no matter how poorly the British economy feels, the British pound will still grow because the dollar will still fall. That's the entire logic to follow over the next three years if the infamous Republican and the chief peacemaker of the 21st century can avoid impeachment.

The average volatility of the GBP/USD pair over the last 5 trading days is 79 pips. For the pound/dollar pair, this value is considered "average." On Friday, February 27, we thus expect movement within the range limited by the levels of 1.3401 and 1.3559. The upper channel of the linear regression is directed upwards, indicating a recovery of the trend. The CCI indicator has entered the oversold zone, signaling a possible end to the correction.

Nearest support levels:

S1 – 1.3428

S2 – 1.3306

S3 – 1.3184

Nearest resistance levels:

R1 – 1.3550

R2 – 1.3672

R3 – 1.3794

Trading Recommendations:

The GBP/USD currency pair is on track to continue the upward trend of 2025, and its long-term prospects remain unchanged. Trump's policies will continue to put pressure on the US economy, so we do not expect the US currency to grow in 2026. Even its status as a "reserve currency" no longer matters to traders. Therefore, long positions with targets of 1.3916 and above remain relevant in the near term when the price is positioned above the moving average. When the price is below the moving average line, small short positions can be considered with targets of 1.3428 and 1.3401 on technical (corrective) grounds. From time to time, the American currency demonstrates corrections (on a global scale), but for a trending rise, it needs global positive factors.

Explanations for Illustrations:

Linear regression channels help determine the current trend. If both are directed in the same way, it means that the trend is strong right now;

The moving average line (settings 20,0, smoothed) determines the short-term trend and the direction in which trading should currently be conducted;

Murray levels are target levels for movements and corrections;

Volatility levels (red lines) are the probable price channel within which the pair will spend the next day, based on current volatility indicators;

The CCI indicator – its entry into the oversold area (below -250) or into the overbought area (above +250) indicates that a trend reversal is approaching in the opposite direction.