The GBP/USD currency pair traded extremely calmly on Tuesday, despite the release of several important and resonant reports from the UK. First, let's start with the unemployment report, which unexpectedly fell from 5.2% to 4.9%, below forecasts of 5.2%. Such a decrease in one of the main macroeconomic indicators should have triggered a rise in the British currency. And it would have, if it weren't for one "but"—the market has been ignoring the macroeconomic backdrop for two months now.

There is no need to search for a "spoonful of tar" in the report itself. This is far from the first time that the market has shown no reaction to crucial data. If the report was not as strong as it appears at first glance, the pound should have dropped immediately following the publication. If the report was indeed good, the British currency should have risen. However, we saw neither of these outcomes, and the US dollar's moderate growth is purely corrective. The GBP/USD pair had also risen for two consecutive weeks, so a slight pullback is not detrimental.

Although the influence of geopolitics is waning, the market is still not rushing to respond to standard fundamentals and macroeconomic factors. Upcoming meetings of the Bank of England and the Federal Reserve are approaching, and the British central bank seemed much more "hawkish" a month ago than its American counterpart. Nevertheless, the dollar continued to rise, driven solely by geopolitical factors.

Currently, the market is in limbo, as it is unclear whether a new round of negotiations between Tehran and Washington will take place this week. JD Vance may have already flown to Islamabad, but what stops Iran from once again refusing to meet? Moreover, various reports suggest that there is no consensus in Tehran regarding negotiations with the US. The Islamic Revolutionary Guard Corps insists on a hardline stance: no negotiations until Washington unblocks Iranian ports. Meanwhile, the new supreme leader of Iran, Mojtaba Khamenei, agrees to meet to resolve the conflict as quickly as possible. The confusion over who is really in charge and making decisions in the country also remains unclear.

As for the negotiations themselves, we remain quite skeptical. We still do not understand what the parties are supposed to negotiate when no one is willing to compromise on the most important points. The only chance for the world is the signing of a nuclear deal akin to the one that existed between the countries ten years ago. Specifically, representatives from international organizations would be allowed access to Iran's nuclear facilities to establish control over enriched uranium. However, has Tehran agreed to a new nuclear deal when Donald Trump once unilaterally withdrew from a similar agreement? In Tehran's view, any arrangement with the US guarantees nothing.

The average volatility of the GBP/USD pair over the last 5 trading days is 67 pips, which is considered "average." On Wednesday, April 22, we expect the pair to trade within a range between 1.3434 and 1.3568. The upper linear regression channel has turned downward, signaling a bearish trend. The CCI indicator has entered overbought territory and has formed a "bearish" divergence, warning of a potential downward pullback.

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 continues to recover after two months of geopolitical influences. Trump's policies will continue to exert pressure on the US economy, so we do not expect the US currency to grow in 2026. Thus, long positions targeting 1.3916 and above remain relevant when the price is above the moving average. If the price is below the moving average, short positions can be considered, with targets at 1.3428 and 1.3367, based on geopolitical factors. In recent months, nearly all news and events have turned against the British pound, prolonging the downward trend. However, geopolitics no longer supports the dollar, and the pound now appears to be more at ease.

Explanations of Illustrations:

Linear regression channels help to define the current trend. If both are directed in the same way, it means the trend is currently strong;

The moving average line (settings 20,0, smoothed) determines the short-term trend and the direction in which trading should currently be conducted;

Murray levels are target levels for movements and corrections;

Volatility levels (red lines) indicate the probable price channel in which the pair will operate over the next day, based on current volatility readings;

The CCI indicator – its entrance into the oversold area (below -250) or the overbought area (above +250) indicates that a trend reversal in the opposite direction may be approaching.