Key Moments
- GBP/USD trades near 1.3360 in early European hours as investors watch US-Iran developments.
- Meanwhile, Donald Trump says Iran wants a deal, but Iranian officials firmly deny any talks.
- Technicals suggest a bearish bias, with resistance at 1.3390 and support at 1.3257 and 1.3220.
Market Overview
GBP/USD holds in a tight range near 1.3360 early Thursday. Trading remains quiet as investors wait for clarity on a possible US-Iran ceasefire.
At the same time, mixed signals shape sentiment. US President Donald Trump claims Iran is eager to reach a deal. However, officials in Tehran strongly reject this view.
According to an Associated Press report, Trump said Iran “wants a deal badly.” He added that Iranian leaders hesitate to admit this publicly due to internal and external threats.
Tehran Rejects Notion of Ceasefire Talks
In contrast, Iran denies any negotiations. Foreign Minister Abbas Araghchi said Tehran has not entered talks and does not plan to do so.
Moreover, state media reports that Iran will end the conflict only on its own terms. Until then, it plans to continue operations across the region.
As a result, uncertainty remains high. The US Dollar Index (DXY) holds steady near 99.65, reflecting cautious market positioning.
GBP/USD Technical Setup
GBP/USD trades flat near 1.3360 at the time of writing. The short-term outlook remains bearish, as lower highs continue to form.
The pair trades close to the 20-day Exponential Moving Average (EMA). This level has flattened and now caps gains near 1.3390.
Meanwhile, the 14-day Relative Strength Index (RSI) moves between 40 and 60. This range shows fading downside momentum, but the broader bearish bias remains intact.
| GBP/USD Technical Levels | Level | Comment |
|---|---|---|
| Immediate resistance | 1.3390 | 20-day EMA caps upside |
| Next resistance | 1.3480 | Recent high where rallies stalled |
| Upside trigger | Close above 1.3480 | Would ease bearish pressure |
| Initial support | 1.3257 | Recent low |
| Next target | 1.3220 | Break below 1.3257 exposes this level |
| Extended downside | 1.31 area | Further decline if 1.3220 breaks |
A daily close above 1.3480 would reduce downside pressure. In that case, GBP/USD could move toward the mid-1.35 area.
On the downside, a break below 1.3257 would expose 1.3220. If selling continues, the pair may fall toward 1.31.
(The technical analysis of this story was written with the help of an AI tool.)
Understanding Risk Sentiment
In financial markets, “risk-on” and “risk-off” describe investor behavior. During risk-on periods, traders favor higher-risk assets due to optimism.
In contrast, risk-off phases reflect caution. Investors shift toward safer assets that offer more stability.
Assets to Watch for Risk Appetite
During risk-on conditions, stocks usually rise. Most commodities also gain, supported by growth expectations.
In addition, commodity-linked currencies and cryptocurrencies often strengthen.
However, during risk-off periods, government bonds tend to rise. Gold also benefits, along with safe-haven currencies like the US Dollar, Japanese Yen, and Swiss Franc.
Currencies in Risk-On vs Risk-Off Phases
In risk-on markets, the Australian Dollar, Canadian Dollar, and New Zealand Dollar often gain. These currencies track commodity demand and global growth.
Similarly, emerging market currencies such as the Ruble and South African Rand may strengthen.
On the other hand, risk-off sentiment supports the US Dollar, Japanese Yen, and Swiss Franc. These currencies benefit from safe-haven demand.
The US Dollar gains from its reserve status. Meanwhile, the Yen and Swiss Franc attract flows due to stable financial systems and strong investor confidence.
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