empty
29.01.2025 01:11 PM
GBP/USD – January 29: Market Stalls Ahead of FOMC Meeting

The GBP/USD pair continued its decline on Tuesday after rebounding from the resistance zone of 1.2488–1.2508. This suggests that the pair may extend its downward movement today toward the support range of 1.2363–1.2370. However, it remains within an upward trend channel, so a sharp drop is not anticipated at this stage.

This image is no longer relevant

The wave structure is clear: the last completed downward wave broke below the previous low, while the most recent upward wave has yet to reach the previous peak. This pattern suggests the continuation of a bearish trend. A reversal would require the pair to rise at least to 1.2569 and close confidently above this level. However, there is a discrepancy between the wave structures of the euro and the pound, meaning one of these formations will eventually be invalidated.

On Tuesday, market activity was muted due to a lack of significant economic data from both the UK and the US. The only published report from the US failed to generate interest among traders, who are reluctant to open new positions ahead of the Federal Reserve's decision later today. Market participants do not anticipate changes to monetary policy or a shift in Jerome Powell's rhetoric. However, the US dollar has been declining for three consecutive weeks, possibly due to concerns about Donald Trump's potential influence on the Federal Reserve. Historically, the dollar has weakened under Trump's leadership, and traders appear to hold a skeptical outlook on his economic policies, despite his claims of wanting to "Make America Great Again."

This image is no longer relevant

On the four-hour chart, GBP/USD continues to rise within a downward trend channel. A rejection from its upper boundary could lead to a reversal in favor of the dollar, pushing the pair down toward the 100.0% Fibonacci retracement level at 1.2299. However, if the pair consolidates above the channel, it could force bears out of the market entirely. Additionally, a bullish divergence is forming on the CCI indicator, but today's movement will largely depend on the market's reaction to the FOMC decision.

COT Report Analysis

This image is no longer relevant

The latest Commitments of Traders (COT) report shows an increasingly bearish sentiment among speculative traders. The number of long positions decreased by 4,861, while short positions increased by 3,834. Bulls have steadily lost their advantage over the past few months, and the gap between short and long positions now favors bears—84,000 versus 75,000.

From a broader perspective, the pound remains under selling pressure, as COT data signals strengthening bearish positions almost every week. Over the past three months, long positions have dropped from 161,000 to 75,000, while short positions have risen from 67,000 to 84,000. This trend suggests that institutional traders are likely to continue reducing long positions or increasing shorts, as most bullish factors for the pound have already played out. While technical analysis currently indicates potential for further growth, corrective movements are also expected.

Key Events to Watch

  • FOMC Interest Rate Decision (19:00 UTC)
  • FOMC Press Conference (19:30 UTC)

Although today's economic calendar includes only two key events, they could be pivotal for the US dollar. Market sentiment will be heavily influenced by the Federal Reserve's decision and Powell's statements during the press conference.

Trading Strategy for GBP/USD

Selling opportunities arise if the pair consolidates below the ascending trend channel on the hourly chart. Short positions were also viable upon rejection from the 1.2488–1.2508 zone, targeting 1.2363–1.2370. On the other hand, buying opportunities may emerge if the pair rebounds from the 1.2363–1.2370 support zone, with a potential upside target at 1.2488–1.2508.

Fibonacci retracement levels are drawn from 1.3000–1.3432 on the hourly chart and from 1.2299–1.3432 on the four-hour chart.

Samir Klishi,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Chancy Deposit
    Deposit your account with $3,000 and get $1000 more!
    In February we raffle $1000 within the Chancy Deposit campaign!
    Get a chance to win by depositing $3,000 to a trading account. Having fulfilled this condition, you become a campaign participant.
    JOIN CONTEST

Recommended Stories

Forex forecast 19/02/2025:

Useful links: My other articles are available in this section InstaForex course for beginners Popular Analytics Open trading account Important: The begginers in forex trading need to be very careful

Sebastian Seliga 10:24 2025-02-19 UTC+2

GBP/USD – February 19: UK Inflation Hits Record Highs

On the hourly chart, GBP/USD continued to hover around the resistance zone of 1.2611 – 1.2620 on Tuesday. A rebound from 1.2611 – 1.2642 would favor the U.S. dollar

Samir Klishi 10:00 2025-02-19 UTC+2

AUD/USD: Risk of Decline in the Pair

The Reserve Bank of Australia (RBA), like the Reserve Bank of New Zealand (RBNZ), continues its monetary policy easing to create conditions for stimulating economic growth. For now, the pair

Pati Gani 09:36 2025-02-19 UTC+2

EUR/USD and GBP/USD – February 19 Technical Analysis

At the start of the new trading week, bearish players have paused, leading to a daily corrective decline. The daily Ichimoku cross serves as the nearest reference point for this

Evangelos Poulakis 07:16 2025-02-19 UTC+2

Technical Analysis of Intraday Price Movement of Platinum Commodity Instrument, Wednesday February 19, 2025.

If we look at the 4-hour chart of the Platinum commodity instrument, a Bearish 123 pattern appears followed by several Bearish Ross Hook (RH) where all of this indicates that

Arief Makmur 06:26 2025-02-19 UTC+2

Technical Analysis of Intraday Price Movement of AUD/JPY Cross Currency Pairs, Wednesday February 19, 2025.

With the appearance of Convergence between the price movement of AUD/JPY and the Stochastic Oscillator indicator, it confirms that in the near future AUD/JPY has the potential to strengthen where

Arief Makmur 06:26 2025-02-19 UTC+2

EUR/USD Forecast for February 19, 2025

The euro seems to have given up its attempt to reach the target range of 1.0534 to 1.0575. To confirm this reversal, today's session must close below the 1.0458 level

Laurie Bailey 03:47 2025-02-19 UTC+2

GBP/USD Forecast for February 19, 2025

The UK employment data for December, released yesterday, helped the pound avoid a decline, even though the dollar strengthened by 0.34%. The pound fell by only 0.10%, while the euro

Laurie Bailey 03:45 2025-02-19 UTC+2

AUD/USD Forecast for February 19, 2025

Yesterday, the Reserve Bank of Australia reduced the interest rate from 4.35% to 4.10%, and the Australian dollar held steady. However, today's rate cut by the Reserve Bank

Laurie Bailey 03:45 2025-02-19 UTC+2

Trading Signals for BITCOIN (BTC/USD) for February 18-20, 2025: buy above $ 95,000 (21 SMA - 200 EMA)

On the H1 chart, Bitcoin is trading around $95,000 above the 21 SMA and below the 200 EMA within a bearish trend channel forming since February 14. If Bitcoin breaks

Dimitrios Zappas 15:26 2025-02-18 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.