GBP/USD analysis: pressure mounts ahead of UK employment data
|GBP/USD Current Price: 1.2517
- Pound weakened on the back of persistent Brexit uncertainty.
- GBP/USD pressuring the 1.2500 figure, also a critical Fibonacci support.
- Latest UK employment data and a BOE’s Carney speech to gather attention Wednesday.
The Sterling has weakened against its American rival, with the GBP/USD pair falling to 1.2509, bouncing just modestly ahead of the US close to finish the day in the 1.2520 region. The UK currency was unable to capitalize broad dollar’s weakness, as Brexit concerns weighed, although there was no particular catalyst behind the intraday decline. The UK will release this Tuesday its latest employment data. The ILO unemployment rate for the three months to May is expected to remain steady at 3.8%. Wages in the same period are seen up by 3.5% YoY excluding bonus, and by 3.1% including bonus. The number of unemployed people is expected to have decreased to 18.9K in June from 23.2K in the previous month. The employment report is considered a first-tier one, despite the sector is doing quite well, and wages have been above inflation for almost a year. The effect of the report in the price, however, is expected to be short-lived, moreover considering BOE’s Governor Carney is scheduled to speak later in the day.
GBP/USD short-term technical outlook
The GBP/USD pair erased Friday’s gains, having met short-term buying interest around the 23.6% retracement of the 1.2734/1.2438 decline at 1.2500, but given that the price hardly moved away from the level, the risk is skewed to the downside for this Tuesday. The 4 hours chart shows that the pair broke below the 20 SMA, later pulling back to the indicator before resuming its decline and achieving fresh lows, while technical indicators maintain their bearish slopes below their mid-lines, all of which favors a downward extension in the upcoming sessions.
Support levels: 1.2500 1.2475 1.2430
Resistance levels: 1.2550 1.2590 1.2630
View Live Chart for the GBP/USD
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.