GBP/USD begins Tuesday’s session on a positive note as market participants continued to sell the Dollar and most US assets, following Trump’s trade-war escalation with Europe. This and a sell-off of Japanese bonds, keeps the CBOE Volatility Index (VIX) at yearly highs, a sign of risk aversion.
💡 DMK Insight
GBP/USD is gaining traction as the Dollar weakens amid rising geopolitical tensions. The ongoing trade-war rhetoric from Trump is pushing traders to offload US assets, which is creating a favorable environment for GBP. With the CBOE Volatility Index (VIX) at yearly highs, risk aversion is palpable, suggesting that traders are seeking safer havens. This could lead to further strength in GBP/USD if the trend continues. Keep an eye on key resistance levels around 1.40, as a break above could signal a more sustained rally. Conversely, if the VIX starts to decline, it might indicate a return to risk-on sentiment, which could reverse the current trend. It’s worth noting that while the GBP is benefiting now, the underlying economic fundamentals still matter. If UK economic data disappoints, the rally could be short-lived. Watch for upcoming economic releases that could impact GBP sentiment and adjust your positions accordingly.
📮 Takeaway
Monitor GBP/USD for potential resistance at 1.40; a break could lead to further gains amidst ongoing risk aversion.





