News Details

GBP/USD traded at 1.3515 on Tuesday as the US dollar strengthened. Pressure on the pound intensified at the start of the week following a sharp escalation of the US-Iran conflict, with markets fearing the breakdown of the truce and rotating into safe-haven assets. The trigger was heightened tensions around the Strait of Hormuz. The US reported the detention of an Iranian vessel, while Tehran refused to participate in further negotiations. This development supported higher oil prices and boosted demand for the dollar. An additional factor weighing on sterling is domestic UK politics. Prime Minister Keir Starmer has come under pressure following the scandal surrounding the appointment of Peter Mandelson as ambassador to the US. The market is watching his parliamentary address and assessing the risks of political instability. Despite the current decline, the pound remains close to two-month highs and is up approximately 2% for the month. It had previously been supported by expectations of de-escalation in the Middle East. If political pressure on the government intensifies further, the pound could give back some of its recent gains. Technical analysis on the H4 GBP/USD chart shows a consolidation range between 1.3494 and 1.3545, with potential downside targets at 1.3333 and an upside breakout target at 1.3611. The MACD indicator confirms a downtrend. On the H1 chart, a compact consolidation range around 1.3515 is observed, with a downside breakout target at 1.3444 and a possible rise to 1.3495. The Stochastic oscillator confirms a downside trend. Conclusion: The pound has come under pressure due to renewed US-Iran tensions around the Strait of Hormuz, driving safe-haven demand for the dollar. Domestic political uncertainty, particularly the scandal involving the appointment of Peter Mandelson, adds further risk. Despite recent gains, technical indicators suggest further near-term downside risk if geopolitical or political pressures intensify.