The GBP/USD pair has also completed a return to a bullish imbalance. As early as yesterday or today, a reaction to this imbalance and a resumption of growth in line with the bullish trend could have been expected. However, the outcome of the Bank of England meeting somewhat surprised traders and provided support to the bears. For now, the British pound is being supported by the size of bullish imbalance 14. Since this imbalance is quite wide (140 points), price may remain within it for several days or even weeks before reacting and completing the required reversal. The imbalance will be invalidated below the 1.3400 level, so the pound still has a margin of safety.

From the perspective of the news backdrop for 2025–2026, it is difficult for me to imagine a prolonged bearish advance. Still, one cannot be 100% certain that this is impossible. In my view, the current working strategy is to wait for a reaction in the euro and the pound to bullish imbalances. None of them have been invalidated, so bullish sentiment in the market remains fully intact.

The bullish trend in the pound remains in place, and this is confirmed by the technical picture. Imbalance 14 acts not only as a zone of interest for bulls but also as a support area for price. Therefore, its invalidation would signal weakening bullish intentions, which could allow bears to go on the offensive. The informational grounds for a decline in the pair raise some questions, but market moves do not always correspond to economic data. The market has its own mechanics, and they do not depend entirely on the news backdrop.

Thursday's news backdrop was positive for the bears. The Bank of England's Monetary Policy Committee decided to keep interest rates unchanged by a narrow vote of five to four. Traders had expected a much more decisive victory for the hawks. However, the doves proved stronger than anticipated, although it is quite difficult to say why. I would like to remind you that inflation in the UK remains fairly high and accelerated to 3.4% year-on-year in December. If inflation is rising, it is hardly advisable to ease monetary policy when the goal is to bring inflation down. Nevertheless, bearish pressure may be limited, as the rate was not cut and dovish prospects did not become stronger. If the next two inflation reports show further acceleration, the number of doves at the next meeting may decline noticeably.

In the United States, the overall news backdrop remains such that, in the long term, nothing but a decline in the dollar can be expected. The situation in the U.S. remains quite complex. U.S. labor market data continue to disappoint or are ignored by the market. The last three FOMC meetings ended with dovish decisions, and the latest data suggest that the pause in monetary easing will be short-lived. Trump's military aggression, threats toward Denmark, Mexico, Cuba, Colombia, Iran, EU countries, Canada, and South Korea, the initiation of criminal proceedings against Jerome Powell, and a new government shutdown all neatly complement the current picture of the U.S. political crisis. In my view, bulls have everything they need to continue their advance throughout 2026 (with pauses, of course).

A bearish trend would require a strong and stable positive news backdrop for the U.S. dollar, which is difficult to expect under Donald Trump. Moreover, the U.S. president himself does not want a strong dollar, as the trade balance would remain in deficit in that case. Therefore, I still do not believe in a bearish trend for the pound. Too many risk factors continue to weigh heavily on the dollar. What would bears use to push the pound lower? If new bearish patterns appear, a potential decline in the pound sterling could be reconsidered, but at the moment, there are none.

News Calendar for the United States and the United Kingdom:

United States – University of Michigan Consumer Sentiment Index (15:00 UTC)

On February 6, the economic calendar contains only one entry. The impact of the news backdrop on market sentiment on Friday may be weak and limited to the evening.

GBP/USD Forecast and Trader Advice:

For the pound, the picture remains clear; what is missing are new buy signals. Bulls have launched a new advance that threatens to become quite long-lasting and significant.

Since the bullish trend is indisputable, traders are left to trade to the upside using clear patterns and clear signals. In the near future, traders may expect the formation of a new bullish signal within imbalance 14. As a potential upward target, I previously considered the 1.3725 level, which has already been reached, but the pound could rise much higher in 2026. There are no limits—especially given the events of the first month of the year. If bearish patterns form, short trades are also possible, but within a bullish trend, I consider buying to be more appropriate than selling.