GBP/USD loses the 1.22 handle to close out Friday trading

The GBP/USD initially rose on Friday, but got knocked lower as the market broadly swept back into the US Dollar.
The US Dollar index caught a late bid to push back into the middle to close out the trading week.
Recession risk is still quite high in the UK, capping Pound Sterling bids.

Joshua Gibson FXStreet

The GBP/USD sank just south of the 1.2200 handle heading into the Friday market close, and the pair finds itself still struggling under the weight of a heavy bearish trend.

Inflation continues to be a hot topic for the Bank of England (BoE), and the UK may have no choice but to continue facing down high interest rates. With prices continuing to grow above the BoE's target, interest rate cuts remain a far-off dream for market investors hoping to get their borrowing and funding costs eased.

UK labor conditions continue to deteriorate, and the manufacturing outlook remains pessimistic looking forward.

Next week the UK will see Manufacturing Purchasing Manager Index (PMI) figures for September; the PMI data is broadly expected to show continued deterioration in economic expectations.

The US Dollar (USD) is set to remain well-bid through next week's trading window. An impending US government shutdown is seeing the Greenback bolstered across the broader market, and a government shutdown could see next week's Non-Farm Payrolls delayed.

Pound Sterling fails to hold recovery as US Dollar recovers

GBP/USD technical outlook

The Sterling got rejected from the 200-hour Simple Moving Average after peaking at an intraday high of 1.2270 on Friday, sending the pair into a fresh low of 1.2180 for the day.

The GBP/USD is currently pinned to the midpoint at the 34-hour Exponential Moving Average (EMA) as intraday momentum bleeds out, and the midweek's bounce from a near-term low if 1.2110 looks set to run out of steam.

Daily candlesticks have the GBP/USD deeply off the beaten path, tumbling away from the 200-day SMA currently parked just above 1.2400, and the pair is set to continue charging into fresh six-month lows is selling pressure keeps up.

A descending 34-day EMA is providing dynamic resistance for any potential bullish pullbacks, and is currently priced in at the 200-day SMA, looking for a bearish crossover.

GBP/USD daily chart

GBP/USD technical levels

GBP/USD

Overview
Today last price	1.2199
Today Daily Change	-0.0001
Today Daily Change %	-0.01
Today daily open	1.22

Trends
Daily SMA20	1.2394
Daily SMA50	1.2602
Daily SMA100	1.2626
Daily SMA200	1.2435

Levels
Previous Daily High	1.2225
Previous Daily Low	1.212
Previous Weekly High	1.2425
Previous Weekly Low	1.2231
Previous Monthly High	1.2841
Previous Monthly Low	1.2548
Daily Fibonacci 38.2%	1.2185
Daily Fibonacci 61.8%	1.216
Daily Pivot Point S1	1.2139
Daily Pivot Point S2	1.2077
Daily Pivot Point S3	1.2034
Daily Pivot Point R1	1.2243
Daily Pivot Point R2	1.2286
Daily Pivot Point R3	1.2348

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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