GBP/USD has been extending its falls amid a mix of dollar strength and virus concerns. US Nonfarm Payrolls may trigger a temporary dollar correction, providing a fresh selling opportunity, according to FXStreet’s Analyst Yohay Elam.
Bounce before a plunge to 1.3670?
“In the UK, the greater worry is that the reopening now planned for July 19 could be delayed again – or perhaps watered down. The Delta variant continues spreading quickly, and the consequent increase in hospitalizations causes worries. Additional time would help Britain vaccinate more people. More broadly, concerns of a new winter wave also weigh on economic prospects.”
“The Fed and investors now have their eyes fixed on June's all-important Nonfarm Payrolls. The economic calendar is pointing to an increase of 690,000 jobs, better than May's 559,000 and alongside a drop in the Unemployment Rate to 5.6%.”
“All in all, there is room for disappointment in Nonfarm Payrolls, resulting in an upswing for GBP/USD. Nevertheless, the basic fundamentals have not changed – the US economy is still growing quickly and the Fed is set to withdraw some of its support.”
“Immediate support is at the fresh low of 1.3743, followed by 1.3720, a swing low from April. The critical level to watch is 1.3670, which was a double-bottom back in April and also the lowest since February.”
“Resistance is at 1.3785, a trough from mid-June, followed by 1.3835, a level that capped a recovery attempt earlier this week. Further above, 1.3875 and 1.3940 await 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. 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
AUD/USD holds gains near 0.7000 amid PBOC's status-quo, Gold price surge
AUD/USD is clinging to mild gains near 0.7000 early Monday. The pair benefits from a risk-on market profile, China's steady policy rates and surging Gold and Copper prices. Focus now remains on Fedspeak for fresh impetus.
Gold price hits an all-time high to near $2,440
Gold price (XAU/USD) climbs to a new record high near $2,441 during the Asian trading hours on Monday. The bullish move of the precious metal is bolstered by the renewed hopes for interest rate cuts from the US Federal Reserve (Fed).
EUR/USD gains ground above 1.0850, focus on Fedspeak
The EUR/USD pair trades on a stronger note around 1.0875 on Monday during the early Asian trading hours. The uptick in the major pair is bolstered by the softer Greenback. The Federal Reserve’s Bostic, Barr, Waller, Jefferson, and Mester are scheduled to speak on Monday.
AI tokens could really ahead of Nvidia earnings
Native cryptocurrencies of several blockchain projects using Artificial Intelligence could register gains in the coming week as the market prepares for NVIDIA earnings report.
Week ahead: Flash PMIs, UK and Japan CPIs in focus. RBNZ to hold rates
After cool US CPI, attention shifts to UK and Japanese inflation. Flash PMIs will be watched too amid signs of a rebound in Europe. Fed to stay in the spotlight as plethora of speakers, minutes on tap.