Uncertainty surrounding US trade policy weighed on the dollar, causing the pound to trade in a range above 1.35 against the dollar.
2026-02-26 13:54:42
The pound maintained its weekly gains against the dollar during Asian trading hours on Thursday, trading around 1.3565. The dollar index fell slightly to around 97.55, becoming the main external factor driving the pound's rebound.
The pressure on the US dollar stems primarily from the continued uncertainty surrounding US trade policy. On the policy front, the US Supreme Court ruled that President Donald Trump's tariff measures, implemented under his national emergency economic powers, were "illegal," raising market concerns about the stability of US trade policy.
Markets worried that trading partners might use this as an excuse to demand revisions to trade agreements in exchange for more favorable terms. However, Trump subsequently warned that the U.S. could impose higher tariffs if other countries violate existing trade agreements, which kept trade tensions alive and put downward pressure on the dollar.
Regarding monetary policy, the outlook for the pound remains uncertain. The market widely expects the Bank of England to cut interest rates at its March monetary policy meeting. This expectation limits further upside potential for the pound, keeping the exchange rate in a short-term consolidation pattern.
From a technical perspective, GBP/USD is currently trading around the 20-day exponential moving average (EMA) at 1.3562, a level that is clearly acting as resistance, indicating a lack of clear directional momentum. After retreating from its mid-month high, the price has gradually stabilized, and the candlestick pattern shows a sideways consolidation, suggesting the market is more inclined towards range-bound consolidation than trend continuation.
The RSI indicator is in the neutral range of 40-60, indicating a relatively balanced balance between bullish and bearish forces, with a lack of strong short-term trend momentum. Initial support lies in the area around the February 19 low of 1.3434; if the exchange rate breaks below this level, it may further test the 1.3344 area.
The first resistance level to watch is the high of 1.3712 on February 11. If it breaks through effectively, it may retest the area near the four-year high of 1.3869.
Editor's Note:
The current movement of the pound against the dollar is primarily driven by the interplay between uncertainty surrounding US trade policy and expectations regarding the Bank of England's policy. Fundamentally, the market is characterized by a weaker dollar but limited upward momentum for the pound. Technically, the exchange rate is oscillating around short-term moving averages, with the RSI indicating neutral momentum.
In the short term, the price is more likely to remain range-bound. Only if the price breaks above 1.3710 can it open up more upside potential. If it falls below 1.3430, it may turn into a weak and volatile trend.
The pressure on the US dollar stems primarily from the continued uncertainty surrounding US trade policy. On the policy front, the US Supreme Court ruled that President Donald Trump's tariff measures, implemented under his national emergency economic powers, were "illegal," raising market concerns about the stability of US trade policy.
Markets worried that trading partners might use this as an excuse to demand revisions to trade agreements in exchange for more favorable terms. However, Trump subsequently warned that the U.S. could impose higher tariffs if other countries violate existing trade agreements, which kept trade tensions alive and put downward pressure on the dollar.
Regarding monetary policy, the outlook for the pound remains uncertain. The market widely expects the Bank of England to cut interest rates at its March monetary policy meeting. This expectation limits further upside potential for the pound, keeping the exchange rate in a short-term consolidation pattern.
From a technical perspective, GBP/USD is currently trading around the 20-day exponential moving average (EMA) at 1.3562, a level that is clearly acting as resistance, indicating a lack of clear directional momentum. After retreating from its mid-month high, the price has gradually stabilized, and the candlestick pattern shows a sideways consolidation, suggesting the market is more inclined towards range-bound consolidation than trend continuation.
The RSI indicator is in the neutral range of 40-60, indicating a relatively balanced balance between bullish and bearish forces, with a lack of strong short-term trend momentum. Initial support lies in the area around the February 19 low of 1.3434; if the exchange rate breaks below this level, it may further test the 1.3344 area.
The first resistance level to watch is the high of 1.3712 on February 11. If it breaks through effectively, it may retest the area near the four-year high of 1.3869.
Editor's Note:
The current movement of the pound against the dollar is primarily driven by the interplay between uncertainty surrounding US trade policy and expectations regarding the Bank of England's policy. Fundamentally, the market is characterized by a weaker dollar but limited upward momentum for the pound. Technically, the exchange rate is oscillating around short-term moving averages, with the RSI indicating neutral momentum.
In the short term, the price is more likely to remain range-bound. Only if the price breaks above 1.3710 can it open up more upside potential. If it falls below 1.3430, it may turn into a weak and volatile trend.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
