The GBP/USD currency pair continued to trade very calmly on Wednesday. Naturally, when U.S. inflation data was released, we saw a brief burst of market reaction—though it didn't last long. We've noted that inflation figures in mid-2025 no longer have even 20% of the market impact they did a year or two ago. Back then, every uptick or drop in inflation signaled that the central bank might respond with a significant policy shift. But what about now?
The European Central Bank has already cut rates to a "neutral level," and inflation is hovering near its target. The Bank of England resumed its monetary easing cycle as inflation fell below 3% and economic growth remains sluggish. The Federal Reserve maintains a wait-and-see stance, primarily due to Donald Trump's trade policy and plans to respond only to finalized tariffs and their macroeconomic impact.
Thus, whether inflation rises or falls in the U.S. or the UK is now inconsequential. Would the Fed have raised rates if U.S. inflation had jumped to 3.5–4% in May? It's unlikely, given the ongoing easing cycle. If it dropped to 2%, would the Fed cut rates? It is also unlikely because the global trade framework remains unresolved, and its economic consequences remain unclear.
Meanwhile, mass protests and demonstrations continue across the United States—specifically targeting Trump's immigration policies. To be more precise, they are against Trump personally. Reports are varied, but protestors are reportedly planning demonstrations in nearly all major U.S. cities. Trump, in turn, has stated he is willing to deport or imprison both illegal and even legal immigrants "without trial or investigation." Military forces are being deployed to domestic hotspots—not Afghanistan or Iraq, but cities like Los Angeles and Denver.
The market reaction to the "very good negotiations with China" was telling (i.e., none), while Americans' reaction to Trump's new policies was even more pronounced. Many of the protestors are likely immigrants themselves, feeling threatened. But this isn't a new topic—it has also come up during past events. The United States lacks a consistent political line on immigration. Under one president, the country welcomes immigrants and asylum seekers; under another, it seeks to deport or imprison them forcibly. This lack of a "party line" on immigration reflects a deeper inconsistency.
America wants to accept only the wealthy, intelligent, and "useful" immigrants—which is understandable—but there are many categories of people who enter the country for different reasons. If illegal immigration is truly a problem, then border security should be the focus. Right now, the situation in America is one of chaos and lawlessness. In the past few days, market interest in buying the U.S. dollar has declined.
The average volatility for GBP/USD over the last five trading days is 83 pips, which is considered "moderate" for this pair. We expect price movement on Thursday, June 12, between 1.3463 and 1.3629. The long-term regression channel points upward, signaling a clear bullish trend. The CCI indicator has not recently entered extreme zones.
Nearest Support Levels:
S1 – 1.3489
S2 – 1.3428
S3 – 1.3367
Nearest Resistance Levels:
R1 – 1.3550
R2 – 1.3611
R3 – 1.3672
Trading Recommendations:
The GBP/USD pair maintains its upward trend and continues to rise. The market currently has ample reasons to support this movement. Investors interpret every new Trump decision negatively, and positive news from the U.S. is in short supply.
Long positions targeting 1.3611 and 1.3629 remain relevant while the price stays above the moving average. A breakdown below the moving average may open up short opportunities with targets at 1.3463 and 1.3428, but the probability of growth is currently much higher than that of a decline. The dollar may experience minor corrections from time to time, but clear signs of the end of the global trade war are still needed for a more sustained GBP rally.
Explanation of Illustrations:
Linear Regression Channels help determine the current trend. If both channels are aligned, it indicates a strong trend.
Moving Average Line (settings: 20,0, smoothed) defines the short-term trend and guides the trading direction.
Murray Levels act as target levels for movements and corrections.
Volatility Levels (red lines) represent the likely price range for the pair over the next 24 hours based on current volatility readings.
CCI Indicator: If it enters the oversold region (below -250) or overbought region (above +250), it signals an impending trend reversal in the opposite direction.
