GBP/USD Trades Below Mid-1.3500s Amid Tightening Fed Bets

The GBP/USD pair is trading below the mid-1.3500s level, but its bullish potential remains intact.

Firming US Federal Reserve rate hike bets and escalating US-Iran tensions are supporting the USD and capping the GBP/USD pair.

Traders are also hesitant ahead of this week's release of UK GDP and US inflation figures, which could impact the pair's movement.

From a technical perspective, the 200-period Simple Moving Average on the 4-hour chart is providing support for the pair, with spot prices trading above the 38.2% retracement level at 1.3471.

The Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) are also hinting at constructive but not aggressive upside momentum.