The Sterling is surrendering part of yesterday’s strong gains and is now dragging GBP/USD to test the lower bound of the range in the 1.2275/70 band.
GBP/USD looks to jobs report
After bottoming out near 1.2180 on Tuesday, the pair managed to pick up pace and advance to as high as the vicinity of 1.2330, although the upside momentum run out of legs soon afterwards.
The softer tone around the greenback during the first half of the week plus fresh demand for GBP have pushed spot higher, albeit it remains vulnerable to ‘Brexit’ headlines and implications for UK fundamentals.
Ahead in the session UK’s labour market report is expected to show the Claimant Count Change at 3.0K during September, while the ILO Unemployment rate is seen steady at 4.9%.
Recall that inflation figures in the UK have surprised markets to the upside during last month, lending extra support to the pair and collaborating with the recent upside.
GBP/USD levels to consider
As of writing the pair is losing 0.15% at 1.2279 and a break above 1.2327 (high Oct.18) would aim for 1.2377 (high Oct.11) and finally 1.2614 (20-day sma). On the flip side, the immediate support lines up at 1.2086 (low Oct.11) ahead of 1.1450 (low post-‘flash crash’ Oct.7).