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Sterling Tests Key Resistance at $1.3430

Sterling Tests Key Resistance at $1.3430

The British pound extended its rally on Tuesday, with the GBP/USD pair rising above $1.34 and marking an eleventh consecutive day of gains — its longest winning streak in years. Since mid-January, sterling has surged over 11% amid growing expectations of monetary easing from the Bank of England and sustained weakness in the U.S. dollar.

The upward momentum reflects a combination of cooling UK inflation, fading recession fears, and speculation that the BoE could cut interest rates in the coming months. Meanwhile, investor sentiment toward the dollar remains dampened by political tensions in the U.S. and concerns over the Fed’s independence, following recent public criticism from President Trump.

Technical traders are now closely watching the $1.3430 level, a key resistance point last tested in late September. A failure to break above this level could signal the formation of a double-top pattern and potentially trigger a wave of profit-taking. Conversely, a confirmed breakout could pave the way for a move toward the $1.36 level.

This week’s light economic calendar offers little fundamental resistance to the rally. However, the market remains sensitive to political developments, particularly any unexpected commentary from President Trump that could impact global risk sentiment.

Overall, the pound’s strength is part of a broader trend favoring non-dollar assets, as investors reassess central bank policies and global economic risks heading into the second quarter.

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