আরও দেখুন
05.08.2026 05:46 PM
GBP/USD posted strong gains last week, fully in line with the prevailing fundamental backdrop. It can therefore be said that the bulls launched a new advance at the end of June, followed by a typical corrective pullback, and are now attempting to resume the upward move.
Bearish Imbalance 24 was broken without triggering any meaningful price reaction. As a result, it can now be regarded as an inverted imbalance. Price reacted to this pattern from above as early as Friday, indicating that it has already been validated and has generated a bullish signal.
As for the fundamental backdrop, I continue to believe that it remains supportive of the British pound. As I have noted previously, geopolitical developments are no longer providing sustained support for the U.S. dollar, as each new escalation of the conflict occurs roughly every two weeks and differs little from the previous one. Reports regarding negotiations between Tehran and Washington remain contradictory. According to some sources, talks are continuing; according to others, they have been paused or have collapsed entirely. Officially, Tehran denies holding direct negotiations with the United States but continues discussions through intermediaries, particularly Oman. It remains unclear whether these negotiations will ultimately lead to an end to the conflict and the reopening of the Strait of Hormuz. It is possible that Iran and Oman could reach an agreement regarding oversight of the waterway, but it is uncertain how that would resolve the broader dispute between Iran and the United States.
Last week, oil prices climbed to $100 per barrel, while this week they have fallen back to around $81. If events unfold according to the most pessimistic scenario, oil prices are likely to resume their rally and surpass the highs recorded between March and May. In that case, inflationary pressures in both the United States and the United Kingdom would likely accelerate again. Conversely, under a more optimistic scenario, oil prices could return to the $60–70 per barrel range. In that case, the Federal Reserve might not need to tighten monetary policy further, while the Bank of England is already no longer constrained by excessively high inflation. At present, however, it is the Federal Reserve that remains reluctant to adopt a more hawkish stance—even though, in the author's view, such a move is warranted—whereas the Bank of England expects inflation to accelerate and appears fully prepared to tighten monetary policy further.
From a technical perspective, the charts point to a renewed bullish advance. Traders currently have two bullish imbalances (24 and 25), both of which may be considered potential buying zones. Imbalance 24 generated a buy signal on Friday, which traders could have used to initiate long positions. On Monday, the price returned to this pattern once again and rebounded from it, reinforcing the bullish signal. There are currently no bearish patterns on the chart. Therefore, if sellers attempt to regain control, there are no technical setups that would justify opening short positions.
Wednesday's economic data once again favored the bulls. The U.S. ADP Employment Change report came in at roughly half the consensus forecast, while the ISM Services PMI failed to change market sentiment sufficiently to discourage buyers. Naturally, traders will now turn their attention to Friday's U.S. unemployment and Nonfarm Payrolls (NFP) reports, which are expected to provide greater clarity. Even so, the information currently available is sufficient to keep pressure on the U.S. dollar.
Overall, the fundamental backdrop remains such that I see little reason to expect anything other than a long-term decline in the U.S. dollar. Even the conflict between Iran and the United States has not materially altered this outlook. Nor has the possibility of additional Federal Reserve rate hikes in 2026. Geopolitical tensions temporarily reminded investors of the dollar's traditional safe-haven status, but the most active phase of the conflict has already passed. The Federal Reserve is expected to raise interest rates in 2026, which is fundamentally supportive of the dollar. However, tighter monetary policy would also slow economic growth and weaken the labor market. At the same time, Kevin Warsh was appointed by Donald Trump to lead the FOMC with the objective of pursuing a more accommodative monetary policy—something Jerome Powell was reportedly unwilling to deliver. Therefore, in my opinion, any appreciation of the U.S. dollar should be viewed as temporary rather than the beginning of a sustained trend.
United States
On August 6, the economic calendar contains only two events, neither of which I consider particularly significant. Therefore, the impact of Thursday's macroeconomic releases on market sentiment is likely to be limited.
The long-term outlook for GBP/USD remains bullish. After liquidity was swept below the two most recent swing lows, the bulls resumed their advance. That move was followed by a corrective pullback, and buyers are now attempting another upward push.
I expect the pound to continue strengthening this week, although much will depend on the incoming macroeconomic data. Market participants are awaiting the U.S. unemployment and labor market reports, which are likely to play a key role in shaping expectations for the FOMC's September meeting. If the bears regain the initiative, bearish chart patterns will be needed to justify short positions, but no such patterns are currently present. Meanwhile, the bulls have already received a fresh buy signal.
The next upward targets for GBP/USD are the highs of July 15 and May 1, located at 1.3557 and 1.3656, respectively.
