- GBP/USD extended the previous day’s rejection slide from the 1.2475 supply zone.
- Worsening coronavirus crisis benefitted the USD and kept exerting some pressure.
- The UK Services PMI for March was revised lower and did little to lend any support.
The GBP/USD pair edged lower through the early European session and refreshed daily lows, around the 1.2325 region post-UK macro data.
The pair extended the previous session's rejection slide from the 1.2475 supply zone and witnessed some follow-through selling on the last trading day of the week amid the prevalent strong bullish sentiment around the US dollar.
Despite an unprecedented rise in the US initial weekly jobless claims, the greenback continued benefitting from its status as the global reserve currency amid worries over the worsening economic fallout from the coronavirus pandemic.
Apart from a broad-based USD strength, the fact that Fitch Ratings estimated that the UK's GDP could fall by close to 4% in 2020 further took its toll on the British pound and contributed to the pair's ongoing slide to three-day lows.
The sterling was further pressured by a downward revision of the UK Services PMI, which indicated a sharper-than-anticipated contraction in the services sector activity and came in at 34.5 in March as against the preliminary reading of 35.7.
It will now be interesting to see if the pair continues to show some resilience at lower levels or confirms a near bearish break through the recent trading range as the focus now shifts to the release of the closely watched US monthly jobs report.
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD hovers around 1.0700 after German IFO data
EUR/USD stays in a consolidation phase at around 1.0700 in the European session on Wednesday. Upbeat IFO sentiment data from Germany helps the Euro hold its ground as market focus shifts to US Durable Goods Orders data.
USD/JPY refreshes 34-year high, attacks 155.00 as intervention risks loom
USD/JPY is renewing a multi-decade high, closing in on 155.00. Traders turn cautious on heightened risks of Japan's FX intervention. Broad US Dollar rebound aids the upside in the major. US Durable Goods data are next on tap.
Gold price trades with mild negative bias, manages to hold above $2,300 ahead of US data
Gold price (XAU/USD) edges lower during the early European session on Wednesday, albeit manages to hold its neck above the $2,300 mark and over a two-week low touched the previous day.
Worldcoin looks set for comeback despite Nvidia’s 22% crash Premium
Worldcoin price is in a better position than last week's and shows signs of a potential comeback. This development occurs amid the sharp decline in the valuation of the popular GPU manufacturer Nvidia.
Three fundamentals for the week: US GDP, BoJ and the Fed's favorite inflation gauge stand out Premium
While it is hard to predict when geopolitical news erupts, the level of tension is lower – allowing for key data to have its say. This week's US figures are set to shape the Federal Reserve's decision next week – and the Bank of Japan may struggle to halt the Yen's deterioration.