The British Pound (GBP) remains practically flat against the US Dollar (USD) on Monday, trading both sides of the 1.3450 level, with investors wary of taking excessive risks.
Growing tensions in the Middle East are weighing on risk appetite while USD rallies remain subdued, ahead of a string of key fundamental releases in the US
A further escalation of the tensions between the US and Iran and the extension of Israel’s occupation in Lebanon have prompted retaliation pledges by Iranian authorities, casting shadows over an already frail ceasefire. US President Donald Trump is still due to sign a memorandum of understanding that would extend the ceasefire, and Iran’s Tasnim news agency, citing a source familiar with the negotiations, suggested that the framework of the agreement is not yet confirmed. Beyond that, investors await a slew of key fundamental releases in the US, starting with the US ISM Manufacturing PMI, due later on Monday, and ending on Friday with the all-important May Nonfarm Payrolls report.
These figures may help to assess the next moves from a divided US Federal Reserve committee and hence, set the near-term direction for USD crosses. Technical Analysis: Forming a triangle pattern GBP/USD trades at 1.3461, holding a constructive bullish bias with a succession of lower highs and higher lows forming a triangle pattern. Triangles are considered continuation patterns and, in this case, a bearish outcome is favoured.