GBP/USD consolidates near one-month highs in mid-1.2600s in holiday thinned trade, eyes upcoming risk events

GBP/USD is consolidating in fairly quiet trade close to one-month highs in the mid-1.2600s.
Volumes this week are set to be dampened by US (Monday) and UK (Thursday & Friday) public holidays.
But a barrage of upcoming US data means the prospect for volatility remains elevated.

Joel Frank Independent Analyst

Trading conditions are quiet on Monday amid a lack of US market participants given market closures there for the Memorial Day public holiday. GBP/USD is nonetheless trading close to the one-month highs it printed last Friday in the 1.2670 area at just below 1.2650 amid an upbeat tone to risk appetite at the start of the week. The pair is on course to have rallied around 4.0% from mid-month lows in the mid-1.2100s, a move which analysts are mostly putting down to the weakening of the US dollar, which has continued this Monday.

That means the pair is on course to post a monthly gain of about 0.6%, it's first monthly gain of the year. Still, analysts remain cautious on the prospects for a more meaningful rebound in the pair given the divergence between the outlooks for the US and UK economies and associated divergence between the outlook for Fed and BoE policy. Both remain in the US dollar’s favour, analysts argue, suggesting that a return to recent lows is perhaps more likely that a move back above the 1.30 mark.

Indeed, data released by the US Commodity Futures Trading Commission (CFTC) last Friday showed that, as of last Tuesday, investors continued to add to net sterling short positions, despite the rebound from mid-month lows. That suggests a continued appetite to sell the rally.

GBP/USD trading volumes are expected to pick up on Tuesday with the return of US market participants, but will likely then die down again from Thursday into the end of the week, given the closure of UK markets for a long public holiday weekend for the British Queen’s Platinum Jubilee celebration. That doesn’t mean there won’t be volatility. Indeed, traders are bracing for a barrage of US data set to be released this week.

May Conference Board Consumer Confidence survey data is out on Tuesday, May ISM Manufacturing PMI survey data and April JOLTs Job Openings data is out on Wednesday, May ADP Private Employment Change data is out on Thursday, while the official May labor market report is out on Friday. After its prolonged recent decline, USD bulls may be looking for an opportunity to reload on long positions

GBP/Usd

Overview
Today last price	1.2629
Today Daily Change	0.0000
Today Daily Change %	0.00
Today daily open	1.2629

Trends
Daily SMA20	1.2436
Daily SMA50	1.2776
Daily SMA100	1.3109
Daily SMA200	1.3333

Levels
Previous Daily High	1.2667
Previous Daily Low	1.2579
Previous Weekly High	1.2667
Previous Weekly Low	1.2472
Previous Monthly High	1.3167
Previous Monthly Low	1.2411
Daily Fibonacci 38.2%	1.2633
Daily Fibonacci 61.8%	1.2613
Daily Pivot Point S1	1.2583
Daily Pivot Point S2	1.2537
Daily Pivot Point S3	1.2495
Daily Pivot Point R1	1.2671
Daily Pivot Point R2	1.2713
Daily Pivot Point R3	1.2759

Author

Joel Frank

Independent Analyst

Joel Frank is an economics graduate from the University of Birmingham and has worked as a full-time financial market analyst since 2018, specialising in the coverage of how developments in the global economy impact financial asset

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