Over the past week, GBPUSD has eased back, pulling away from the mid-April peaks that followed the Middle East ceasefire. However, don't be fooled by the pause. The closure of the Strait of Hormuz and the resulting explosion in energy prices are still very much in play—and they will continue to drag on the UK economy and its currency for a long time to come.
The first clear warning shot arrived in March. British inflation ripped higher, offering the most tangible evidence of the geopolitical fallout. The Headline Consumer Price Index (CPI) rose to 3.3% year‑on‑year, up from 3.0% in February—its strongest reading in a quarter and a decisive break from the downtrend many had predicted. The monthly figure came in at 0.7%, well above expectations and the usual seasonal average.
All eyes are now on the Bank of England's (BoE) next policy meeting, scheduled for April 30. Markets are almost certain that borrowing costs will stay at 3.75%, so there won't be any drama. The real mover for quotes will be the regulator's updated economic forecasts, which often move the needle more than the rate decision itself.
When you look at the charts, GBPUSD seems to be vulnerable. A recent rejection from resistance, paired with technical indicators flashing red, points to further downside. The first major target to watch is 1.30000—a critical support zone that could determine whether the pound drifts lower or tumbles.
The final recommendation:
— Sell GBPUSD at the current price, targeting 1.30000 within one to two months.
— Keep things under control with a Stop Loss order set just above the 1.36000 resistance. Therefore, if the pair heads the wrong way, the position will be protected.
This content is for informational purposes only and is not intended to be investing advice.
