• Stalled US-Iran talks and weaker equities kept market sentiment fragile.
• Fed and BoE meetings this week could drive the pair’s direction.
• UK political turmoil may limit Sterling gains despite hawkish rate pricing.

GBP/USD registers modest gains during the North American session, up by 0.19%, as US-Iran talks stalled, while market mood remains fragile, as reflected in US equity markets trading lower. The pair trades at 1.3548, after bouncing off daily lows of 1.3499.

Sterling firms as Fed, BoE meetings and politics draw focus ahead

The economic schedule in both sides of the Atlantic will be busy. On Tuesday, the Federal Reserve begins its two-day monetary policy meeting, in which policymakers are expected to keep interest rates unchanged as they digest the impact of high energy prices sparked by the Middle East conflict. Eyes will also be on Fed Chair Jerome Powell’s decision to stay at the US central bank or to resign once Kevin Warsh is approved to succeed him.

Meanwhile, a day later on Thursday, the Bank of England is also projected to hold rates, but a split vote could trigger a jump in GBP/USD if some members vote to raise rates. The vote split is projected at 8-1, with the outlier expected to vote for a rate hike. Worth noting that money markets had priced in 56 basis points of increases, according to Prime Terminal data.

BoE implied forward rates

Even though expectations are that the GBP/USD could continue to rise, political turmoil in the UK may weigh on sterling. The PM, Keir Starmer, is facing scrutiny for appointing Labor veteran Peter Mandelson as ambassador to the US. Mandelson’s ties to Jeffrey Epstein’s files increased pressure on Starmet, who faces opposition from members of his own party, to resign.

Eyes turn to a scarce economic docket on Tuesday, with no data expected in the UK. In the States, traders’ eyes are in the ADP Employment Change 4-week average, housing data, and the Conference Board (CB) Consumer Confidence survey for April.

GBP/USD Price Forecast: Technical outlook

In the daily chart, GBP/USD trades at 1.3550. The pair retains a bullish near-term bias as spot holds decisively above a dense cluster of the 50-, 100- and 200-day Simple Moving Averages (SMAs) grouped around 1.3410, while also respecting an underlying rising trend-line now coming in near 1.3490. The latest reading of the FXS Fed Sentiment Index at 129.62 continues to grind higher, which hints that broader USD tone is softening and reinforces the upside skew in sterling as long as price remains above these reclaimed structural floors.

On the downside, initial support is located at the rising trend-line support zone around 1.3490, ahead of the former descending resistance line, now acting as secondary support near 1.3435. A break beneath that area would expose the confluence of the 50-, 100- and 200-day SMAs clustered close to 1.3410, where buyers would be expected to defend the broader uptrend. With no clearly defined resistance levels above the market in the provided dataset, the topside stays open, and any fresh swing high would likely attract follow-through buying while the pair holds above the 1.3490–1.3410 support band.

(The technical analysis of this story was written with the help of an AI tool.)