Technical Analysis:
GBP/USD remains confined around the pivotal 1.2900 area after encountering firm resistance at the intraday high of 1.2929, precisely aligned with Wednesday's earlier Asian-session low. The pair had earlier rebounded from its Asian-session low of 1.2872, representing a two-week trough sparked by renewed concerns over potential U.S. tariffs targeting the UK. The significant options expiry of approximately £1 billion at 1.2900 has added further downward gravitational pull, likely constraining meaningful upside momentum in the near term.

On a technical basis, immediate support remains near Wednesday’s post-budget update low at 1.2874 and closely below at the key Asian low at 1.2872. A decisive move beneath these supports would open potential downside toward the ascending 21-day moving average, currently at approximately 1.2850, a critical short-term pivot. If bearish pressure intensifies amid escalating global tariff tensions or renewed risk aversion driven by weakening equity markets, GBP/USD could swiftly test deeper supports toward the 1.2750/60 area, marking a substantial shift in short-term sentiment.

Conversely, bullish momentum would require GBP/USD to clear resistance at 1.2929 decisively, subsequently targeting the 10-day moving average at 1.2955. Above that, resistance at Monday’s high of 1.2974 becomes the next significant hurdle, preceding the crucial March high at 1.3015. However, given the precarious backdrop of ongoing tariff negotiations and equity market vulnerability—where any substantial correction could prompt significant dollar demand—cable bulls should exercise caution. Heightened volatility triggered by sharp equity market declines could prompt aggressive USD buying, placing GBP/USD bulls at considerable near-term risk, especially if the broader technical supports around 1.2850 fail to hold.