GBP/USD analysis on January 30, 2025
GBP/USD is showing a moderate correction around 1.2445, remaining within the boundaries of the sideways range. Investors evaluate the statements of regulators and macroeconomic signals, determining further forex trading strategies.
The day before, the head of the Bank of England, Andrew Bailey, announced the postponement of the implementation of the Basel 3.1 standard to January 2027. This standard defines the minimum capital requirements for banks and is aimed at strengthening the stability of the financial system. However, its introduction has been delayed due to a lack of consensus among key players in the global economy. In particular, American banks insist on raising the minimum capital threshold, which creates additional risks for financial institutions in the UK and the EU. Thus, further steps in this direction largely depend on the position of the US authorities, whose possible unwillingness to follow the new standards may increase global financial uncertainty.
British Finance Minister Rachel Reeves presented a set of measures aimed at accelerating the country's economic growth. Among the key initiatives are the modernization of public infrastructure, the expansion of Heathrow Airport through the construction of a new runway, the development of renewable energy (wind farms and reservoirs), as well as the organization of a transport corridor between Oxford and Cambridge. These projects are aimed at transforming the region into the European equivalent of Silicon Valley and are designed to strengthen the UK's competitive position in the field of high technology.
The Fed's monetary policy and the dynamics of the dollar
After the decision of the US Federal Reserve to leave the key rate in the range of 4.25–4.50%. The dollar index is holding at 107.60. The Fed's decision was expected, especially after three consecutive rate cuts. Fed Chairman Jerome Powell confirmed the regulator's commitment to reduce inflation to the target level of 2.0% and stressed that it was too early to talk about a complete abandonment of the "hawkish" monetary policy. He also noted that Donald Trump's policy has not yet had a significant impact on the Fed's strategy, and the regulator will continue to act independently, focusing on the stability of consumer prices.
Technical analysis for GBP/USD for today
On the daily chart, the GBP/USD pair is testing the resistance line of the descending channel in the range of 1.2500–1.2000, reflecting the uncertainty of market participants.
Technical indicators signal a slowdown in the downtrend:
• The fast EMAS on the Alligator indicator are approaching the signal line, indicating a possible transition to a consolidation phase.
• The histogram of the Awesome Oscillator indicator (AO) shows correction bars, which may indicate a change in trend direction.
Trading Recommendations
Buy:
• Entry after the breakdown and consolidation above 1.2500.
• The target is 1.2700.
• Stop-Loss – 1.2400.
Sale:
• Entry after fixing below 1.2370.
• The target is 1.2160.
• Stop-Loss – 1.2430.
Thus, in the short term, the key factor for the GBP/USD pair will remain the balance between the Fed's rhetoric and the UK's economic initiatives.