GBP/USD HOLDS NEAR 1.3400 AFTER BOE RATE HOLDGBP/USD hovers around the 1.3400 mark following the Bank of England’s decision to keep interest rates steady at 4.25%, as widely expected. The hold reflects the central bank’s cautious approach amid slowing economic data and persistent global uncertainties.
Meanwhile, during the Asian session, the pair dropped sharply, hitting a one-month low of 1.3382, equivalent to a 0.24% decline on the day. The move was largely driven by a stronger U.S. dollar, which gained traction following the Federal Reserve’s hawkish tone on Wednesday. Additionally, investor sentiment was weighed down by growing concerns over potential U.S. military involvement in the Middle East conflict, further boosting safe haven flows into the dollar and pressuring the pound.
However, a rebound was observed during the European session, as the pair regained some ground. The recovery was buoyed by positive market reaction to BoE Governor Andrew Bailey’s remarks, which, while dovish in tone, provided a sense of stability
TECHNICAL VIEW
From a technical perspective, the pair remains in a clear downtrend, with lower highs and lower lows confirming bearish momentum, as sellers continue to dominate amid broader risk aversion in global markets.
In the face of heightened geopolitical tensions in the Middle East, safe-haven demand for the U.S. dollar has strengthened. This macro backdrop supports continued downside pressure on the pair. If the price breaks below the 1.3382 support, it will signal renewed bearish momentum, opening the door for further declines toward 1.3334, followed by 1.3253.
On the other hand, if buyers’ step and push the price above 1.3476, this would mark a break of the immediate market structure, potentially signaling a bullish reversal or short-term correction. In this scenario, the next upside targets would be 1.3579 and 1.3632, key resistance levels. Meanwhile break out of these levels are not ruled out.
Conclusively, while the prevailing trend remains bearish, volatility driven by geopolitical headlines and dollar strength could result in breakouts on either side.
