GBP/USD: Bears attack 1.3100 at 16-month low amid Russia-Ukraine stand-off

GBP/USD treads water around the lowest levels since November 2021, recently making rounds to 1.3100 during Tuesday’s Asian session.

The cable pair slumped to the multi-day low amid broad US dollar strength as the market players rush to risk-safety amid escalating inflation fears due to the Ukraine-Russia tussles. However, headlines suggesting the US allies’ resistance in banning imports from Moscow seem to have paused the GBP/USD bears afterward.

Additionally, chatters over a restart of the human corridor to evacuate Kyiv’s civilians also challenged the pair sellers of late.

Even so, headlines from Reuters suggesting no change in tension joins red-tape due to Brexit to weigh on the cable prices. “Ukrainian officials said a Russian airstrike hit a bread factory in northern Ukraine on Monday, killing at least 13 civilians, while talks between Kyiv and Moscow made little progress towards easing the conflict,” said Reuters.

Amid these plays, S&P 500 Futures drop 0.30%, tracking Wall Street losses, whereas the US 10-year Treasury yields extend the previous day’s rebound from two-month to 1.77% up 2.5 basis points at the latest.

Moving on, a lack of major from the UK and the US may keep GBP/USD traders directed towards the Kyiv-Moscow headlines for fresh impulse. However, Thursday’s US Consumer Price Index (CPI) will be important as the Fed may have to extend push to for 0.50% rate-hike if inflation fears worsen.

Technical analysis

A clear downside break of an ascending trend line from September and May months of 2020, respectively near 1.3315 and 1.3255, directs GBP/USD bears towards the 1.3000 psychological magnet.