FX.co ★ Jackroay | GBP/USD

I am closely watching the geopolitical situation around the Strait of Hormuz because I understand that any confirmed blockage would dramatically affect global energy flows and risk sentiment in the financial markets. I note that nearly 20% of global oil supply passes through this corridor, so I believe that even the possibility of disruption is enough to keep energy markets tense. I observe that Brent Crude Oil prices have already climbed above the $90 level, yet the movement still appears moderate rather than explosive, which tells me that the market has not fully priced in a complete shutdown of tanker traffic. I think that if shipping through the strait were suddenly halted, I could quickly see oil accelerating toward the $100–$110 zone as traders rush to secure supply. I also believe that such geopolitical stress normally increases volatility across currencies, but I notice that commodity currencies and risk assets have not collapsed as much as one might expect, which suggests to me that traders are still waiting for confirmation rather than reacting purely to speculation. I therefore interpret the current environment as a cautious risk phase where markets remain sensitive to weekend news developments and any escalation in the Middle East could immediately change the sentiment when trading resumes.

I am also analyzing the technical structure of GBP/USD, and I see that despite last week’s decline, the pound managed to outperform the euro and recovered a large portion of its losses before the weekly close. I notice that the 1.3260 level acted as strong support because it marked the weekly low and generated a clear rebound that pushed the pair back toward the psychological 1.3400 zone. I think the 1.33 region is currently functioning as a critical demand area because previous candles with long lower shadows show that buyers repeatedly entered between roughly 1.3350 and 1.3252. I am considering the possibility that if sellers fail to break and hold below 1.3300, the pair could form a base for a corrective move higher. I also believe that a confirmed breakout above 1.3467 would strengthen the bullish scenario and could open the path toward 1.3570 and eventually even 1.3720 on the daily timeframe. I still recognize that the market remains inside a broad consolidation that started near 1.3870, so I understand that any upward move may initially be only a correction rather than a full trend reversal. I therefore plan to watch the 1.3377–1.3324 buy zone and the resistance region around 1.3455–1.3489, because I believe that holding above 1.3408 would allow buyers to target 1.3430 and later 1.3489, while a break below 1.3376 could shift momentum back toward 1.3310 and possibly 1.3296.