|

GBP/USD holds steady around the 20-day EMA, on mixed US data

  • GBP/USD rate hovers above the 1.2400 mark after the last week’s USD boost from stronger-than-expected jobs data.
  • US economic indicators reveal a mixed story, with weakening factory orders and a fall in Non-Manufacturing PMI.
  • UK outpaces expectations with S&P Global Services and Composite PMIs, adding pressure on the Bank of England to address inflation concerns.

GBP/USD trims some of its losses but remains trading below its opening price; after the latest week, robust jobs reports boosted the American Dollar (USD), but Monday’s agenda capped the USD gains. Therefore, the GBP/USD is exchanging hands at 1.2440, 0.04% below its opening price but higher than the day’s low of 1.2368.

GBP/USD slashes early losses on weakening US factory orders and falling Treasury bond yields, limiting US Dollar gains as the UK PMI beats estimates

Last week, the US Bureau of Labor Statistics (BLS) revealed May’s data, showing the creation of more than 300K jobs, thought flashed the Unemployment Rate at 3.7%, sought by the US Federal Reserve (Fed), as a sign the economy is cooling and unexpectedly boosted the US Dollar (USD), as the GBP/USD retreated last Thursday¿s gains.

But on Monday, the story is different as Factory Orders in the US weakened, from 0.6% to 0.4% in May, less than estimations. Core Orders, excluding transportation, plummeted 0.2% but improved compared with March’s 0.7% drop. At the same time, the Institute for Supply Management (ISM) revealed that the Non-Manufacturing PMI fell to 50.9 from April’s 51.9, portraying that the economy is weakening.

After the data was released, the greenback weakened, as shown by the US Dollar Index (DXY), which tracks the buck’s value vs. a basket of peers. The DXY d down 0.09%, at 103.947, failing to crack the 104.000 mark, weighed by falling US Treasury bond yields. The US 10-year Treasury bond yield drops two basis points, at 3.677%.

On the UK front, the S&P Global Services and Composite PMIs beat estimates, with the Services Index registering a 55.2, exceeding forecasts of 55.1, though less than April’s 55.9. However, price input pressures rose the most in three months, with wages being the main reason. That would keep the Bank of England (BoE) pressured to deliver further tightening as inflation proves to be stickier than expected.

GBP/USD Price Analysis: Technical outlook

GBP/USD Daily chart

Given the fundamental backdrop, the GBP/USD is neutral to upward biased. In fact, today’s price action forming a gravestone doji or a hammer would put the 1.2500 figure into play. Still, traders must reclaim the 20-day Exponential Moving Average (EMA) resistance at 1.2442, followed by 1.2450. Once cleared, that could pave the way towards 1.2500. Conversely, the GBP/USD first support would be the 1.2400 figure, followed by the current week’ slow of 1.2368.

GBP/USD

Overview
Today last price1.2442
Today Daily Change-0.0008
Today Daily Change %-0.06
Today daily open1.245
 
Trends
Daily SMA201.2463
Daily SMA501.2453
Daily SMA1001.23
Daily SMA2001.1994
 
Levels
Previous Daily High1.2545
Previous Daily Low1.2442
Previous Weekly High1.2545
Previous Weekly Low1.2327
Previous Monthly High1.268
Previous Monthly Low1.2308
Daily Fibonacci 38.2%1.2481
Daily Fibonacci 61.8%1.2505
Daily Pivot Point S11.2413
Daily Pivot Point S21.2376
Daily Pivot Point S31.2309
Daily Pivot Point R11.2516
Daily Pivot Point R21.2582
Daily Pivot Point R31.2619

Author

Christian Borjon Valencia

Christian Borjon began his career as a retail trader in 2010, mainly focused on technical analysis and strategies around it. He started as a swing trader, as he used to work in another industry unrelated to the financial markets.

More from Christian Borjon Valencia
Share:

Markets move fast. We move first.

Orange Juice Newsletter brings you expert driven insights - not headlines. Every day on your inbox.

By subscribing you agree to our Terms and conditions.

Editor's Picks

EUR/USD remains below 1.1750 ahead of ECB policy decision

EUR/USD remains on the back foot below 1.1750 in the European session on Thursday. Traders move to the sidelines and refrain from placing any fresh directional bets on the pair ahead of the ECB policy announcements and the US CPI inflation data. 

GBP/USD stays defensive below 1.3400, awaits BoE and US CPI

GBP/USD oscillates in a narrow band below 1.3400 in European trading on Thursday. The pair trades with caution as markets eagerly await the BoE policy verdict and US consumer inflation data for fresh directional impetus. 

Gold holds losses below $4,350 ahead of US CPI report

Gold struggles to capitalize on the previous day's move higher and holds its pullback below $4,350 in the European session on Thursday. The downtick could be attributed to some profit-taking amid a US Dollar bounce. All eyes now remain on the US CPI inflation data. 

BoE set to resume easing cycle, trimming interest rate to 3.75%

The Bank of England will announce its last monetary policy decision of 2025 on Thursday at 12:00 GMT. The market prices a 25-basis-point rate cut, which would leave the BoE’s Bank Rate at 3.75%.

US CPI data expected to show inflation rose slightly to 3.1%, cooling Fed rate cut bets for January

The US Bureau of Labor Statistics will publish the all-important Consumer Price Index (CPI) data for November on Thursday at 13:30 GMT. The CPI inflation in the US is expected to rise at an annual rate of 3.1% in November

Dogecoin Price Forecast: DOGE breaks key support amid declining investor confidence

Dogecoin (DOGE) trades in the red on Thursday, following a 4% decline on the previous day. The DOGE supply in profit declines as large wallet investors trim their portfolios. Derivatives data shows a surge in bearish positions amid declining retail interest.