The dollar strengthened, and the pound continued its correction against the dollar.
2026-04-24 09:50:06
On Friday during Asian trading hours, the pound remained weak against the dollar, trading around 1.3465, close to its near two-week low. Overall, the exchange rate faces the risk of ending its two-week winning streak and has entered a pullback phase after encountering resistance above 1.3600, indicating a significant weakening of short-term upward momentum.
The core factor driving the dollar's strength stems from uncertainty in the Middle East. Although the ceasefire agreement between the US and Iran was briefly extended, the lack of substantial progress in negotiations, coupled with the US blockade of Iranian ports, has reignited regional tensions. Meanwhile, the ongoing standoff over the Strait of Hormuz has significantly increased market concerns about an escalation of the conflict. This uncertainty has strengthened the dollar's appeal as the global reserve currency, thus putting downward pressure on the pound against the dollar.
Furthermore, energy supply risks continue to escalate. Restrictions on shipping through this key route have fueled market concerns about crude oil supply, pushing oil prices to remain high. Rising oil prices are further exacerbating global inflationary pressures, with markets anticipating that major central banks may adopt a more hawkish policy stance. In particular, the growing expectation that the Federal Reserve will maintain high interest rates or even extend its tightening cycle is providing solid support for the US dollar.
However, the pound is not entirely without support. The latest UK Purchasing Managers' Index (PMI) data came in better than expected, indicating that economic activity remains resilient. Market surveys show that traders currently expect the Bank of England to raise interest rates by approximately 60 basis points by the end of 2026, with a roughly 70% probability of a rate hike in June. This expectation has limited the pound's downside to some extent, preventing a full release of bearish sentiment.
From a market sentiment perspective, investors are currently caught between "risk aversion and policy maneuvering." On the one hand, geopolitical risks are driving funds to safe-haven assets such as the US dollar; on the other hand, the resilience of UK economic data has maintained some confidence in the pound. This divergence has led to a short-term downward trend in GBP/USD.
From a technical perspective, on the daily chart, GBP/USD encountered significant resistance and fell back after touching around 1.3600, forming a temporary top structure. The current price has broken below short-term moving average support, turning the trend bearish. Key support lies at the psychological level of 1.3400 ; a break below this level could lead to a further test of the 1.3350 area . Resistance is located in the 1.3520-1.3550 range . Momentum indicators show that bearish momentum is gradually increasing, but it has not yet entered extreme oversold territory. On the 4-hour chart, the price is trading within a descending channel, and short-term rebounds are limited. If it cannot regain a foothold above 1.3500, the overall trend remains downward. If a technical rebound occurs, attention should be paid to whether the resistance zone is broken.
Editor's Summary <br/>Overall, the current GBP/USD exchange rate is driven by both geopolitical risks and monetary policy expectations. Uncertainty in the Middle East strengthens the safe-haven appeal of the US dollar, while rising oil prices push up inflation expectations, providing justification for the Federal Reserve to maintain its tightening policy, thus putting continuous pressure on the exchange rate. Although robust UK economic data provides some support for the pound, its upside potential remains limited given the strong dollar. In the short term, the exchange rate will continue to fluctuate around geopolitical developments and macroeconomic data, and volatility may continue to increase.
The core factor driving the dollar's strength stems from uncertainty in the Middle East. Although the ceasefire agreement between the US and Iran was briefly extended, the lack of substantial progress in negotiations, coupled with the US blockade of Iranian ports, has reignited regional tensions. Meanwhile, the ongoing standoff over the Strait of Hormuz has significantly increased market concerns about an escalation of the conflict. This uncertainty has strengthened the dollar's appeal as the global reserve currency, thus putting downward pressure on the pound against the dollar.
Furthermore, energy supply risks continue to escalate. Restrictions on shipping through this key route have fueled market concerns about crude oil supply, pushing oil prices to remain high. Rising oil prices are further exacerbating global inflationary pressures, with markets anticipating that major central banks may adopt a more hawkish policy stance. In particular, the growing expectation that the Federal Reserve will maintain high interest rates or even extend its tightening cycle is providing solid support for the US dollar.
However, the pound is not entirely without support. The latest UK Purchasing Managers' Index (PMI) data came in better than expected, indicating that economic activity remains resilient. Market surveys show that traders currently expect the Bank of England to raise interest rates by approximately 60 basis points by the end of 2026, with a roughly 70% probability of a rate hike in June. This expectation has limited the pound's downside to some extent, preventing a full release of bearish sentiment.
From a market sentiment perspective, investors are currently caught between "risk aversion and policy maneuvering." On the one hand, geopolitical risks are driving funds to safe-haven assets such as the US dollar; on the other hand, the resilience of UK economic data has maintained some confidence in the pound. This divergence has led to a short-term downward trend in GBP/USD.
From a technical perspective, on the daily chart, GBP/USD encountered significant resistance and fell back after touching around 1.3600, forming a temporary top structure. The current price has broken below short-term moving average support, turning the trend bearish. Key support lies at the psychological level of 1.3400 ; a break below this level could lead to a further test of the 1.3350 area . Resistance is located in the 1.3520-1.3550 range . Momentum indicators show that bearish momentum is gradually increasing, but it has not yet entered extreme oversold territory. On the 4-hour chart, the price is trading within a descending channel, and short-term rebounds are limited. If it cannot regain a foothold above 1.3500, the overall trend remains downward. If a technical rebound occurs, attention should be paid to whether the resistance zone is broken.
Editor's Summary <br/>Overall, the current GBP/USD exchange rate is driven by both geopolitical risks and monetary policy expectations. Uncertainty in the Middle East strengthens the safe-haven appeal of the US dollar, while rising oil prices push up inflation expectations, providing justification for the Federal Reserve to maintain its tightening policy, thus putting continuous pressure on the exchange rate. Although robust UK economic data provides some support for the pound, its upside potential remains limited given the strong dollar. In the short term, the exchange rate will continue to fluctuate around geopolitical developments and macroeconomic data, and volatility may continue to increase.
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