GBP/USD flattened out just beneath 1.2650 as Brexit vote looms, US NFP in the barrel

GBP/USD is trading just shy of 1.2650, trading flatly with little signs of upside momentum despite a steady climb from the bounce following Thursday's risk-off plummet. The Pound drifted higher through Thursday's trading as the US Dollar shoved lower on investor fears of economic contagion, with a global growth slowdown beginning to show up in US data much sooner than expected. On the UK side, the House of Commons is due to vote on PM May's broadly-maligned Brexit withdrawal agreement, where the halfway deal is expected to lose soundly.

The Sterling's economic calednar showing for Friday is limited and strictly mid-tier, with UK Mortgage Approvals in November expected to slip to 66.5 thousand (last 67.086 thousand), with December's Markit Services PMI forecast to tick upwards into 50.7 (last 50.4), with both reports coming in at 09:30 GMT.

Friday brings another round of the US Non-Farm Payrolls report, dropping on markets at 13:30 GMT, and traders will be bracing for the key data reading as broad-market risk appetite twists on growing fears of contraction; the headline NFP reading is expected to clock in at 177 thousand versus the previous period's 155 thousand, while Average Hourly Earnings for the year into December are seen declining from 3.1% to 3.0%.

GBP/USD Levels to watch

Bullish potential for the Cable remains firmly capped, and the pair is continuing to squirm on the downside of key resistance according to FXStreet's own Valeria Bednarik:

The GBP/USD pair is poised to close the day with modest gains but the short-term picture continues to indicate that the upward potential is limited, as, in the 4 hours chart, the price remains below a bearish 20 SMA which extends its decline below the 200 EMA, while the Momentum indicator maintains a firm downward slope below its mid-line and the RSI tries to stabilize around 48.

Support levels: 1.2610 1.2570 1.2535
Resistance levels: 1.2650 1.2685 1.2720