GBP/USD fall off 2018 high, under pressure ahead of Fed’s speeches and US data

  • GBP/USD falls off 2018 high as the UK wage growth missed the market expectations.  
  • The US dollar rebounds in the European session and is currently well-supported.

The British pound bulls took the lead in the early European session and brought the pair to 1.4377 exceeding the 2018 high made on January 25 at 1.4346. However, the UK labor market report came in mixed. The average weekly earning came in below expectations at 2.8% y/y versus 3% y/y forecast overshadowing the unemployment rate falling to 4.2%, the rate unseen seen since 1975. After the news, the GBP/USD sold off from the fresh new yearly high. More details on the recent UK data here

The GBP/USD is now under pressure and trading at around 1.4316 down 0.15%.

Coming up next in the US session is the industrial production data for March at 13:15 GMT and four speeches from Fed officials. Next one coming up is John Williams’ speech, President of the San Francisco Federal Reserve which is set to speak about monetary policy at a global symposium co-hosted by the National Association for Business Economics and Bank of Spain at 13:15 GMT in Madrid.

The US Dollar Index (DXY) fell as low as 89.23 in the early European session and has since then made a bullish recovery trading in now in the 89.50 region. 

Earlier in the week, the US dollar was on the backfoot as the market was uncertain what would happen in regards to Russian sanctions and also a tweet by President Trump accusing China and Russia to devalue their currencies to gain a commercial advantage. 

On the Russian sanctions’ question the latest news report that President Trump is keeping the decision on hold for the time being. “We are considering additional sanctions on Russia and a decision will be made in the near future.” said Sarah Huckabee Sanders, the White House press secretary.

GBP/USD 4-hour chart

The pair is facing downwards pressure. Immediate support is seen at 1.4306 swing low then at 1.4252 swing low. Resistance is seen at 1.4377 high of the day and new high of the year. A break above can lead to the 1.4400 and 1.4500 figure. 

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