GBP/USD, Oil Forecast: Two trades to watch

GBP/USD steady below 1.27 despite Trump’s tariff threats

Trade tariff worries drive USD safe-haven flows
BoE’s Huw Pill speaks
GBP/USD failed to retake 1.27

GBP/USD rose to a 10-week high on Monday before slumping lower to its current level around 1.2630 amid a cautious market mood.

Trump has dampened risk appetite, Supporting the US dollar on renewed trade tariff wallet worries. Trump warned that trade tariffs on Mexico and Canada would proceed as planned despite the countries' efforts to increase border security. The announcement is driving safe-haven demand into the US dollar.

The dollar is rising but still trades down 3% from its January peak following a raft of weaker-than-expected U.S. economic data, which has fueled concerns over the economic outlook. Today, attention will be on U.S. consumer confidence, which is expected to fall to 103 in February. The data comes after Michigan's confidence slumped to a 15-month low at the end of last week, and PMI data pointed to deteriorating confidence in business.

In recent sessions, upbeat data has supported the pound, including stronger-than-forecast retail sales and services PMI data. The UK economic calendar is quiet. Instead, a speech by BoE chief economist Huw Pill could offer some guidance over the outlook for rate cuts. The BoE cut rates by 25 basis points in its February meeting and raised its inflation outlook. CPI rose to 3% YoY in January. This poses a headache for the central bank as it weighs up easing monetary policy further.

GBP/USD forecast – technical analysis

GBP/USD has rebounded over 4% from its 1.21 January low, but bulls appear to be running out of steam. Buyers need to rise above the 1.2650-90 zone, the 100 SMA, and the 2025 high to create a higher high and extend the bullish run.

Sellers would need to take out the 1.25 round number and the 50 SMA at 1.2470 to take a leg lower.

Oil rises US imposes more sanctions on Iran

US applies new sanctions on Iran’s oil trade
API oil inventory data is due later
Oil trades in a tight range

Oil prices are rising for a second day on Tuesday amid fresh U.S. sanctions on Iran which increased concerns over tighter supply.

The US applied new sanctions on more than 30 brokers, tanker operators, and shipping companies for their role in transporting Iranian oil. This marks the second round of sanctions as President Trump aims to bring Iran’s crude exports to 0. Iran is the third largest producer in OPEC, with an output of 3.2 million barrels per day in January.

Meanwhile, traders are also eyeing a potential peace deal regarding Ukraine, which could result in eased sanctions on Russia, potentially boosting its oil exports. Increased supply to the market could pressure prices

Oil demand from the West remains solid. However, any further signs of the US economy slowing could unnerve the oil market. API US oil inventory data will be released later today.

Oil forecast – technical analysis

After falling back below the 200 SMA, oil is consolidating between 70 – 73. The price trades below its 50, 100 and 200 SMAs. The RSI is below 50 supporting further losses.

Bears have probed a break below its current range and will need a meaningful break below 70 – 69.90 to confirm a bearish continuation towards 68.40. Below here 67 comes into play.

On the upside, buyers would need to rise above the 50 SMA and horizontal resistance at 73.00 to break out to the upside and expose the 200 SMA at 74.00 ahead of horizontal resistance at 75.00.

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.