- GBP/USD has dropped below 1.3300 on renewed dollar strength.
- Near-term technical outlook turns bearish as buyers fail to lift GBP/USD above key hurdles.
- Investors await November jobs report from the US.
GBP/USD has managed to snap a three-day losing streak on Thursday but failed to hold above 1.3300 as the greenback started to gather strength early Friday. The technical outlook seems to have turned bearish with key resistance levels staying intact.
Later in the day, the US Bureau of Labor Statistics will release the November jobs report. Investors forecast Nonfarm Payrolls (NFP) to rise by 550,000 following October's increase of 531,000.
However, market participants will pay close attention to the wage inflation rather than the headline NFP reading. Average Hourly Earnings is expected to rise by 5% on a yearly basis in November and a stronger-than-anticipated print could trigger another leg higher in the US Dollar Index as it would reaffirm the Fed's tightening prospects. Earlier in the day, Cleveland Fed President Loretta Mester noted that she would support at least one rate hike in 2022 and added that two hikes could be appropriate as well.
US Nonfarm Payrolls November Preview: Can we agree the labour market is healing?
Even if a disappointing jobs report weighs on the greenback, the dollar selloff is likely to remain short-lived as Fed policymakers won't have enough time to adjust their commentary ahead of the blackout period that starts on Saturday.
GBP/USD Technical Analysis
On the four-hour chart, GBP/USD trades below the 20-period and the 50-period SMAs. Additionally, the Relative Strength Index (RSI) indicator stays below 50, suggesting that sellers are starting to dominate the pair's action in the near term.
Currently, GBP/USD is testing 1.3280 static support. In case this level turns into resistance, the next target on the downside aligns at 1.3240 (static level) before 1.3200/1.3195 (psychological level/ November 30 low).
Resistances are located at 1.3300 (psychological level, 20-period SMA), 1.3320 (50-period SMA) and 1.3360 (static level).
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD clings to daily gains above 1.0650
EUR/USD gained traction and turned positive on the day above 1.0650. The improvement seen in risk mood following the earlier flight to safety weighs on the US Dollar ahead of the weekend and helps the pair push higher.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD reversed its direction and advanced to the 1.2450 area after touching a fresh multi-month low below 1.2400 in the Asian session. The positive shift seen in risk mood on easing fears over a deepening Iran-Israel conflict supports the pair.
Gold holds steady at around $2,380 following earlier spike
Gold stabilized near $2,380 after spiking above $2,400 with the immediate reaction to reports of Israel striking Iran. Meanwhile, the pullback seen in the US Treasury bond yields helps XAU/USD hold its ground.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Week ahead – US GDP and BoJ decision on top of next week’s agenda
US GDP, core PCE and PMIs the next tests for the Dollar. Investors await BoJ for guidance about next rate hike. EU and UK PMIs, as well as Australian CPIs also on tap.