The GBP/USD currency pair also traded in mixed directions over the past week but continues its recovery overall. The market frequently changes direction, mostly due to geopolitical events. Recall that just on the weekend before last, Donald Trump announced the proximity of a deal with Iran, and... this weekend he once again stated that a deal with Iran is close. Meanwhile, officials in Tehran continue to report that they will not abandon enriched uranium, stating that Trump's rhetoric does not match reality, and at the moment, there are no agreements between Iran and the US. Tehran continues to demand the unblocking of its ports, the unfrozen assets in foreign banks, reparations, the lifting of sanctions, and much more. Therefore, at this point, we believe there is still a long way to go before a deal is reached. Even an interim one.

However, it must be acknowledged that this is just our assumption. In reality, things may be quite different. Since the market is in the same state of uncertainty, its expectations may differ from ours. Therefore, if the British pound and euro strengthen in sync, it means expectations of an agreement being signed are rising. Conversely, if they weaken, expectations are falling. Unfortunately, predicting geopolitical news and the market's reaction to it is nearly impossible. We must simply react as situations unfold.

This week, several important macroeconomic reports will be released in the US, while the UK event calendar is almost empty. We would like to consider all the most critical reports from across the ocean, but there is little sense in doing so – the market has already ignored macroeconomics and fundamentals for the past three months. Thus, we will focus on the most essential reports – Non-Farm Payrolls and the unemployment rate, which will be published on Friday.

According to forecasts, the unemployment rate will remain unchanged at 4.3%, and the number of new jobs created in May may amount to 96-100,000. We again emphasize that 100,000 new jobs is a relatively low figure, although much better than the weighted average for 2025. The market will react to the actual value relative to the forecast, so, in theory, even 120,000 Non-Farms could trigger a rise in the US dollar.

We say "theoretically" because there is no guarantee that the market will react to this report at all. Additionally, it should be noted that only inflation reports currently influence the Federal Reserve's monetary policy. As inflation rises, the monetary views of the Committee members may become more hawkish. Despite the possibility that raising the key rate could further slow down the economy and cool the labor market. Therefore, the reports on unemployment and Non-Farms are undoubtedly important, but they will not have a long-term effect on the dollar. And they will only be released on Friday, while throughout the week, the market will be forced to respond only to geopolitics.

The average volatility of the GBP/USD pair over the last 5 trading days is 67 pips. For the pound/dollar pair, this value is considered "average." On Monday, June 1, we expect movement within a range between 1.3386 and 1.3520. The upper channel of the linear regression is directed upward, indicating a recovery of the upward trend. The CCI indicator has not formed any signals recently.

Closest support levels:

S1 – 1.3428

S2 – 1.3367

S3 – 1.3303

Closest resistance levels:

R1 – 1.3489

R2 – 1.3550

R3 – 1.3611

Trading Recommendations:

The GBP/USD currency pair continues to recover after a 300-point drop. Trump's policies will continue to pressure the US economy, so we do not anticipate long-term growth for the American currency. However, 2026 is currently shaping up to be super positive for the dollar. Thus, long positions with targets at 1.3550 and 1.3611 can be considered if the price is above the moving average. When the price is below the moving average line, short positions can be traded with targets at 1.3367 and 1.3306 based on geopolitical grounds. The market situation frequently changes, and it continues to predominantly track geopolitical news, which does not exhibit a uniform character.

Explanations for the Illustrations:

Linear regression channels help determine the current trend. If both are pointing in the same direction, the trend is strong;

The moving average line (settings 20,0, smoothed) indicates 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 likely price channel in which the pair will stay over the next day, based on current volatility metrics;

The CCI indicator – its entry into oversold territory (below -250) or overbought territory (above +250) indicates that a trend reversal in the opposite direction is approaching.