GBP / USD (BRITISH POUND / US Dollar)

How can You trade the GBP/USD?

Perhaps the safest method to trade this currency pair is by trading the Great British pound versus against the United States US dollar at your bank or other financial institution. This approach, however, does not give traders the much flexibility they desired and it could take a while until they get the payout on their positions.

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Futures and options are also a popular choice among traders, as these leveraged derivative products allow you to trade the asset of your choice while only investing a fraction of its real market value. The one major disadvantage is that if your trade closes with at a loss, you could lose your invested capital.

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Last but not least, trading with a regulated and trustworthy brokerage is the best way to trade forex online while keeping risks to a minimum. Regulated by the FSCA, CM Trading is one of Africa’s top local brokers. Open a live trading account and enjoy advanced trading tools and a personalized educational package!

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Open a live trading account today and enjoy advanced trading tools and a personalized educational package!

What factors influence the GBP/USD?

  • Key economic events such as gross domestic product statistics, purchasing managers’ indices, and retail sales figures can help traders gauge the performance of the American and British economies.
  • Interest rate decisions, inflation trends, and any changes made to these countries’ monetary policy can cause the GBP/USD to rise or fall.
  • Consumer confidence indices, which measure the public’s mood in the United Kingdom and in the United States, can also affect this pair’s market value.
  • Major political events can further influence the GBP/USD, altering the direction in which the pair trades based on the new administration’s policy.

What to consider when trading the GBP/USD?

The long history, stability, and the economic stature of the United Kingdom and the United States makes the GBP/USD into one of the most widely traded currency pairs. This, in turn, translates into a highly liquid market, so traders can enjoy numerous trading opportunities on this pairthroughout the day.

However, the global currency markets can be difficult to navigate at times, and this currency pair is no different. Those choosing to trade it should keep a close eye on the GBP/USD, price chart and build their trades’ strategiesdevelop their trading strategy accordingly.

Did you know?

Trading tThe GBP/USD pair, also has been known as the ‘trading the cable’ since the 1800s., is where the trader sees how many US dollars are worth one Great British pound.

If the pair is quoted as trading at 1.50, it means it takes $1.50 to buy a single pound.

This pair is among the five most traded currency pairs in the foreign exchange market.