The GBP/USD currency pair traded quite calmly on Friday, which is quite surprising. However, the currency market does not operate on weekends, but Donald Trump is not idle. On Saturday, he announced his decision to raise all tariffs introduced on Friday to 15%, and the market had not yet reacted to the Supreme Court's annulment of those tariffs or to the introduction of new tariffs on all goods from all countries at 10%. Therefore, this week may bring volatile movements and new "surprises."

However, only the American president can know about these "surprises." In this article, we will discuss the scheduled events and economic reports. There will be very few such reports in the next five working days, so it can be assumed that the market's primary focus will be on Trump.

In the UK, no significant events or reports are scheduled for this week. Therefore, the British pound will be entirely dependent on the US dollar. In the US, there will be very few important reports. For example, we do not consider the weekly ADP report to be "important." Even monthly ADP reports rarely reflect the true state of the US labor market. This month, according to the ADP report, 22,000 new jobs were created, while the NonFarm Payrolls report indicated 130,000. On Thursday, initial unemployment claims data will be published, which is not regarded as an important report but may provoke a market reaction in the event of a strong deviation from the forecast. On Friday, the producer price index will be released, which many traders consider important, but recall that last week, the market did not deem it necessary to react even to the inflation report.

The dollar has risen for almost two weeks in a row, even though there were few reasons for this, and it became even less so on Friday and Saturday. As we understand, even if Trump's tariffs for 2025 are indeed lifted, they will be reintroduced in some other form under different laws. Then, all of America may begin suing the US president again, but this process will take another year. The court will nullify the new tariffs, and Trump will introduce third ones. And so on indefinitely. No one intends to return the collected fees to consumers and companies right now. Thus, the trade war continues, and Trump is enraged. An enraged Trump may soon make a series of decisions that, in comparison, will make last year seem not so bad.

Thus, the fundamental backdrop has not provided the dollar with increased positive sentiment. We expect the current downward correction to complete and the upward trend to resume.

The average volatility of the GBP/USD pair over the last 5 trading days as of February 20 is 86 pips. For the pound/dollar pair, this value is considered "average." On Monday, February 23, we expect the pair to move within the range limited by levels 1.3392 and 1.3564. The upper channel of the linear regression indicates an upward trend recovery. The CCI indicator has entered oversold territory, signaling a possible end to the correction.

Nearest Support Levels:

S1 – 1.3428

S2 – 1.3306

S3 – 1.3184

Nearest Resistance Levels:

R1 – 1.3550

R2 – 1.3672

R3 – 1.3794

Trading Recommendations:

The GBP/USD currency pair is poised to continue its 2025 upward trend, and its long-term prospects have not changed. Donald Trump's policies will continue to exert pressure on the US economy; consequently, growth in the US economy is not anticipated in 2026. Even its status as a "reserve currency" no longer holds much significance for traders. Thus, long positions with a target of 1.3916 and above remain relevant for the near term when the price is above the moving average. When the price is below the moving average line, small short positions can be considered with targets of 1.3428 and 1.3392 on a technical (corrective) basis. The US currency shows corrections from time to time (in a global sense), but for trend growth, it requires global positive factors.

Explanations for Illustrations:

• Regression Channels: Regression channels help to determine the current trend. If both are moving in the same direction, it indicates a strong trend at the moment.
• Moving Average Line: The moving average line (settings 20,0, smoothed) defines the short-term trend and the direction in which trading should currently be conducted.
• Murray Levels: Murray levels are target levels for movements and corrections.
• Volatility Levels: Volatility levels (red lines) indicate the probable price channel in which the pair is likely to trade over the next 24 hours, based on current volatility indicators.
• CCI Indicator: The CCI's entry into the oversold area (below -250) or the overbought area (above +250) indicates that a trend reversal in the opposite direction is approaching.