GBPUSD Rally will Correct and Resume

The Fed held rates at 4.50%, matching market expectations. Powell highlighted high uncertainty over the outlook, stressing that tariffs are a significant factor driving inflation expectations.

Economic forecasts saw notable shifts: 2025 GDP growth was trimmed to 1.7% from 2.1%, while core PCE inflation was revised up to 2.8%. The US dollar weakened as the Pound surged, with GBPUSD touching a fresh 4‑month high.

The concern amongst traders and myself is slowing growth and rising inflation.

While the Fed holds rates steady, the USD will weaken, reflecting slower economic activity.

I believe the GBPUSD rally will be short-lived since prices have rapidly increased.


Trend: LSMA moving higher in a sharply vertical fashion

Momentum: Overbought and due for a correction

Japanese Candles: Bullish Engulfing on 1/20 supporting rally - smaller printed candles now

Chart Pattern: None - channel too sharp to draw

Support and Resistance: 1.2650 is Support, 1.3100 is Target

Fundamentals: Next week U.K. CPI and PMI, U.S. GDP

Trade: None - wait for the retracement

Stop: None Target: None Risk:Reward is None