The British Pound (GBP) has dipped below 1.3350 against the US Dollar (USD) after a seven-day rally, with the pair trading near 1.3340 as of Monday morning. This pullback comes as bullish momentum shows signs of fading, with technical indicators such as the Relative Strength drifting towards the 50 midline and the MACD line crossing below the Signal line, signaling a potential bearish move. The GBP/USD pair failed to breach the 1.3385 resistance area, which aligns with the trendline resistance from late May highs and sits just below the key 200-day SMA around 1.3400. A break above this resistance could confirm a trend shift and open the way to the June 15 high at 1.3460 and the May 25 and 26 highs above 1.3500. On the downside, support is seen at Thursday's low of 1.3268, followed by the June 24 low at 1.3140 and the channel bottom near 1.3110 [1].
Geopolitical tensions in the Strait of Hormuz have contributed to market uncertainty, as Iran’s Armed Forces warned that vessels not following designated routes would endanger their security and threatened decisive responses to US interference. Additionally, Iran’s ambassador in China reaffirmed Tehran’s intention to collect fees from vessels crossing Hormuz, a move rejected by the US [1].
From a technical and analyst perspective, United Overseas Bank (UOB) notes that GBP/USD remains elevated after last week’s surge, with scope for a modest intraday pullback likely confined to the 1.3320–1.3375 range and limited risk of a clear break below 1.3320. Over the next one to three weeks, UOB maintains a positive outlook, seeing potential for GBP/USD to test 1.3410, with strong support at 1.3280. The bank considers the recent advance overbought but expects further gains unless 1.3280 is breached [2].
On the macroeconomic front, the UK’s June S&P Global Construction PMI is the only notable domestic data release, while in the US, the ISM Services PMI and comments from Federal Reserve Governor Christopher Waller are expected to influence the USD later in the day [1].
According to a currency heat map, the British Pound was the strongest against the New Zealand Dollar today, while showing a 0.12% decline against the US Dollar [1].
CONCLUSION
The GBP/USD pair has paused its rally below 1.3350 amid easing bullish momentum and heightened geopolitical risks in the Strait of Hormuz. While technical signals suggest a potential pullback, analysts at UOB remain cautiously optimistic for further gains toward 1.3410, provided key support levels hold. Market participants are watching upcoming economic data and geopolitical developments for further direction.