The analysis of the Daily Elliott Wave Charts for GBP\/USD focuses on the rally observed from the low of 13 January 2025. This rally, described as an impulse sequence, suggests an upward extension. The analysis advises against selling, recommending buying dips at the blue box areas during 3, 7, or 11 swings.<\/p>\n
On 11.01.2025, the Daily Elliott Wave Chart showed that the rally peaked at $1.3789, completing wave (3). A subsequent pullback in wave (4) followed, with a double three correction ending wave W at $1.3142. Wave X bounced up to $1.3726 before wave Y moved lower towards the $1.3082-$1.2683 blue box area.<\/p>\n
Current market conditions see GBP\/USD trading above 1.3400, supported by stronger-than-expected December Manufacturing and Services PMIs. This occurs amid anticipation for US labour reports and retail sales data. Sterling continues to maintain strength, nearing a two-month high as these economic reports are awaited. <\/p>\n
The market remains volatile with recent drops in GBP\/USD to below 1.3350 after UK inflation data. Other markets, such as USD\/CHF and GBP\/JPY, show similar fluctuations with changing economic conditions globally affecting currency values.<\/p>\n
We are viewing the rally in GBP\/USD since the January 2025 low as part of a larger bullish sequence. The pair is currently in a corrective pullback, and we are looking for this dip to find support. The key area to watch for buyers to return is between $1.3082 and $1.2683.<\/p>\n
Recent price action has been choppy, with a jump above 1.3400 on strong preliminary PMI figures for December. However, this strength is being questioned because of the recent soft UK inflation data. We saw the November Consumer Price Index (CPI) come in at 2.1%, below expectations and increasing the likelihood of the Bank of England easing policy in early 2026.<\/p>\n
This monetary policy outlook for the UK contrasts with the situation in the United States, where inflation has remained more persistent, with the last reading for November at 3.5%. This divergence suggests underlying strength for the US dollar, which could press the pound lower in the short term. The upcoming combined US labor report and retail sales data will be critical in confirming this trend.<\/p>\n
For derivative traders, this environment of technical support meeting bearish fundamentals is causing a rise in uncertainty. One-month implied volatility for GBP\/USD has risen to 9.5% from an average of 8% last month, suggesting traders are preparing for a larger price swing. This makes strategies like buying straddles or strangles potentially attractive to play the increased volatility, regardless of the direction.<\/p>\n
Given the conflicting signals, a patient approach is warranted before establishing large directional bets. We should watch for the price action as it approaches the $1.3082 level for signs of stabilization or a bullish reversal. A failure to hold this support zone would challenge the long-term upward trend we have seen for most of 2025.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" GBP\/USD rally from January low shows impulse pattern; buy dips at blue box zones amid market volatility.<\/p>\n","protected":false},"author":62,"featured_media":17031,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-37111","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/37111","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/users\/62"}],"replies":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/comments?post=37111"}],"version-history":[{"count":0,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/posts\/37111\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media\/17031"}],"wp:attachment":[{"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/media?parent=37111"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/categories?post=37111"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.vtmarkets.com\/en-asia\/wp-json\/wp\/v2\/tags?post=37111"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}