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GBPUSD: How This Currency Pair Works and How to Start Trading It

Markets
23 April 2025
3 min to read
How to Trade GBPUSD: Learn Market Drivers, Strategy Steps, and Practice with a $50K Demo

The GBP/USD pair shows the exchange rate between the British Pound (GBP) and the US Dollar (USD). As two of the world's most traded currencies, this pair is known for its liquidity, sensitivity to macroeconomic data, and dynamic intraday movements -- making it a favorite for both beginners and advanced traders.

What Is GBP/USD?

GBP/USD reflects how many US Dollars are required to buy one British Pound. The pair is often referred to as “Cable” and is influenced by the economic conditions in the UK and the U.S., central bank policy decisions, and geopolitical events.

This major forex pair is volatile enough for short-term traders while offering enough structure for trend-followers.

How Currency Quotation Works

If GBP/USD = 1.2550, it means 1 British Pound equals 1.2550 US Dollars. Here, the Pound is stronger.

Example: You exchange 100 GBP and receive $125.50. This quote helps traders calculate expected returns and relative value.

Factors Influencing GBP/USD Movement

  • Bank of England interest rate policy
  • U.S. Federal Reserve monetary updates
  • Brexit-related economic changes
  • Inflation and GDP data releases

For example, if the Fed raises rates, the USD may strengthen, causing GBP/USD to fall. If UK inflation spikes and the Bank of England reacts hawkishly, GBP/USD may rise.

How to Interpret GBP/USD Price Changes

When GBP/USD climbs from 1.2500 to 1.2700, it means the Pound is strengthening against the Dollar.

When it drops to 1.2300, the Dollar is gaining.

Example: Suppose the rate moves from 1.2550 to 1.2650 — traders might see this as a signal of rising UK bond yields or strong employment data in Britain.

Step-by-Step Quick Trading Example on GBP/USD

  • On Pocket Option, find GBP/USD or GBP/USD OTC in the list of assets.
  • Review the live chart using technical indicators or market sentiment tools.
  • Choose a trade amount — starting from $1.
  • Select the expiration time — from 5 seconds and up (for OTC assets).
  • Predict the price direction:
    • Press BUY if you believe it will rise.
    • Press SELL if you expect a drop.

    Potential returns can be up to 92%, displayed in advance.

    ➡️ It takes only seconds to register. You can begin with a $5 minimum deposit (deposit may vary depending on payment methods), or use the demo account to test strategies without risk.

    Try Risk-Free — $50,000 Demo Account

    Not sure how to start with GBP/USD? Open a demo account on Pocket Option and get $50,000 virtual funds to practice trading in a real market environment.

    Test various strategies, understand volatility, and build trading habits — all without needing to deposit.

    Later, with a real account from $5, you’ll unlock:

    • Copy-trading
    • Cashback features
    • Trading tournaments
    • Full access to platform tools

    demo account Pocket Option

    Conclusion

    GBP/USD remains a key trading pair for both experienced traders and newcomers. Its deep liquidity and news sensitivity offer numerous short-term and trend-based trading opportunities. Understanding how to trade GBPUSD includes interpreting global economic news, reading the chart effectively, and developing a strategy — which you can practice risk-free using the demo account on Pocket Option.

FAQ

How to trade GBPUSD on Pocket Option?

Choose the asset, analyze trends, and place trades starting from $1 in a few clicks.

How to buy GBPUSD?

Select the GBP/USD pair, make your forecast, and click buy or sell based on market direction.

How to invest in GBPUSD?

Monitor economic indicators and use both trend-following and reversal strategies depending on your analysis.

Is GBPUSD suitable for beginners?

Yes, the pair is liquid, widely covered in financial news, and supported with tools on Pocket Option.

What makes GBPUSD move?

Interest rate decisions, economic releases, and geopolitical developments between the UK and the U.S.