- The GBP/USD forecast suggests a strong finish for the pound in April.
- The pound has had a strong month as the dollar collapsed due to Trump’s aggressive tariff policies.
- Trump eased tariffs on automobiles, boosting the dollar.
The GBP/USD forecast suggests a strong finish for the pound in April, with a projected 3.8% gain against the US dollar. However, consumer sentiment remains weak in the UK due to economic uncertainty. Meanwhile, the dollar recovered slightly on Tuesday after Trump eased automobile tariffs.
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The pound has had a strong month as the dollar has collapsed due to Trump’s aggressive tariff policies. The reciprocal tariffs at the start of the month did the most damage to the dollar. Market participants dumped US assets, and consumer confidence plunged. Despite a 90-day pause, Trump escalated a trade war with China, raising concerns of a US recession.
However, as the month ended, the US president softened his stance. He showed readiness to lower tariffs on China and start negotiations. Moreover, on Tuesday, he eased automobile tariffs, boosting the dollar. Meanwhile, there is progress on trade deals to avoid reciprocal tariffs with countries like India.
Despite the rally in the pound, data on Wednesday revealed weak business sentiment. At the same time, experts believe Trump’s tariffs will hurt growth. Therefore, the rally might slow down in the coming month.
GBP/USD key events today
- ADP Non-Farm Employment Change
- Advance GDP q/q
- Employment Cost Index q/q
- Core PCE Price Index m/m
GBP/USD technical forecast: Bullish momentum fades at the 1.3401 resistance
On the technical side, the GBP/USD price has punctured the 1.3401 resistance level to make a higher high in the uptrend. However, bulls were unable to sustain a strong move above the level, and it pulled back. Still, the price trades above the 30-SMA and the RSI is above 50, supporting a bullish bias.
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GBP/USD has maintained a steep rally, keeping above the 30-SMA. However, the rally shallowed when the price met the 1.3401 resistance. At the same time, bulls weakened, and the price broke below the 30-SMA. Although they recovered, the RSI has made a bearish divergence, indicating weaker momentum.
Therefore, bears might reverse the trend by breaking below the SMA and the 1.3200 support. However, if bulls regain momentum, the price will break above 1.3401, continuing the uptrend.
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