FxWirePro: GBP/USD slips lower as markets struggle to read U.S.-Iran situation

• GBP/USD slipped on Wednesday as lingering doubts over the prospects for peace in the Middle East kept investors cautious and supported safe-haven demand for the dollar...

• Iran said on Tuesday that U.S. strikes near the Strait of Hormuz amounted to a “gross violation” of a ceasefire that had largely held for nearly seven weeks, raising fears of renewed escalation in the region.

• Washington defended the attacks, saying the strikes were carried out in self-defence and targeted missile sites and boats allegedly attempting to lay mines in the strategic waterway.

• Most investors believe the conflict is more likely to move toward a resolution rather than a major escalation, though uncertainty remains elevated.

• Markets expect the Bank of England to deliver one quarter-point rate increase before the end of the year, while also assigning a 50% chance to a second similar hike.

•   Immediate resistance is located at 1.3503(SMA 20), any close above will push the pair towards 1.3520(50%fib)

•  Strong support is seen at 1.3381(38.2%fib) and break below could take the pair towards 1.3339(Lower BB)

  Recommendation: Good to sell around 1.3450, with stop loss of 1.3490 and target price of 1.3390