The GBP/USD pair is bouncing from a fresh 2-week low established at 1.5580, barely holding above the 1.5600 level ahead of the US employment data to be released in a couple of hours. The Pound found support in local construction data, showing that the sector rebounded in June, from the almost two year low posted in April, according to the latest Construction PMI reading, up to 58.1. At the same time, the Nationwide Housing Prices report for June, showed that the annual pace of house prices slowed in June, moderating to 3.3% from 4.6% in May. Lower prices are positive for the GBP as the BOE fears a housing bubble due to strong surge in price over the last two years.
Technically, the pair maintains a negative tone according to its 4 hours chart, as the price is far below its 20 SMA, whilst the technical indicators are barely bouncing from oversold territory. The upcoming direction will be solely dependent on US data, with a negative reading probably triggering a stronger reaction in the pair than a positive one. Should the numbers disappoint, the key resistance level to watch comes at 1.5645, the 38.2% retracement of the latest daily run, as a recovery above it should lead to a continued advance up to the 1.5690/1.5700 region.
To the downside, the main support stands at 1.5550, the 50% retracement of the same rally, with a break below it exposing the pair to a decline down to 1.5480/1.5500.
View live chart of the GBP/USD
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