GBP/USD pares intraday gains, up little around mid-1.3800s post-US ADP


  • GBP/USD gained traction on Wednesday and recovered a major part of the overnight losses.
  • Some cross-driven strength from a fall in the EUR/GBP extended some support to the major.
  • Hawkish Fed expectations, stronger US ADP report underpinned the USD and capped gains.

The GBP/USD pair maintained its bid tone through the early North American session, albeit has retreated few pips from daily tops and was last seen trading around mid-1.3800s.

As investors looked past Wednesday's softer UK GDP print, the GBP/USD pair attracted some buying near the 1.3815 region and has now reversed the previous day's losses to over one-week lows. The uptick lacked any obvious fundamental catalyst and could be solely attributed to some cross-driven strength stemming from an intraday turnaround in the EUR/GBP pair.

Bulls further took cues from hawkish remarks by the Bank of England Chief Economist, Andy Haldane, saying that rising inflationary pressures call for immediate thought, and action, on unwinding the QE. Haldane expects UK inflation to be nearer to 4% by the end of the year than 3% and avoiding inflation surprise is one of the key tasks of the central bank.

Meanwhile, the supporting factor, to a larger extent, was offset by worries about the spread of the more contagious Delta variant of the coronavirus. This, along with a mildly bid tone surrounding the US dollar strength, held traders from placing any aggressive bullish bets and kept a lid on any further gains for the GBP/USD pair, at least for the time being.

The USD held on to its modest gains following the release of the ADP report, which showed that private-sector employers added 692K new jobs in June. This marked a notable deceleration from the previous month's blowout reading of nearly one million but was still better-than-consensus estimates pointing to a reading of 600K.

Meanwhile, a fresh leg down in the US Treasury bond yields capped any meaningful upside for the greenback and continued lending some support to the GBP/USD pair. Wednesday's US economic docket also features the release of Chicago PMI and Pending Home Sales. The key focus, however, will remain on Friday's US monthly jobs report, popularly known as NFP.

Technical levels to watch

GBP/USD

Overview
Today last price 1.385
Today Daily Change 0.0014
Today Daily Change % 0.10
Today daily open 1.3836
 
Trends
Daily SMA20 1.4023
Daily SMA50 1.4032
Daily SMA100 1.3952
Daily SMA200 1.3634
 
Levels
Previous Daily High 1.3886
Previous Daily Low 1.3814
Previous Weekly High 1.4001
Previous Weekly Low 1.3787
Previous Monthly High 1.4234
Previous Monthly Low 1.3801
Daily Fibonacci 38.2% 1.3842
Daily Fibonacci 61.8% 1.3859
Daily Pivot Point S1 1.3805
Daily Pivot Point S2 1.3774
Daily Pivot Point S3 1.3733
Daily Pivot Point R1 1.3877
Daily Pivot Point R2 1.3917
Daily Pivot Point R3 1.3948

 

 

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.

Feed news

How do emotions affect trade?
Follow up our daily analysts guidance

Subscribe Today!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD: An inverse head-and-shoulder targets 1.1750 before resuming the down trend

EUR/USD extends its five-day rally, trades above 1.1600. The market sentiment remains upbeat, as major US stock indices record gains between 0.46% and 68%, while the safe-haven status of the US dollar weakens across the board.

EUR/USD News

GBP/USD bulls flirt with 1.3800 around monthly high, focus on UK inflation

GBP/USD seesaws around 1.3800 as traders brace for the key inflation data during Wednesday’s Asian session. The cable pair cheered hopes of the Bank of England’s (BOE) rate hike, as well as broad US dollar weakness, to refresh the multi-day high the previous day. 

GBP/USD News

Gold at a critical technical juncture

Gold is subdued and rests in familiar territory awaiting the next major catalyst to kick start it into gear within bullish territory towards the psychological $1,800 level. The stagflation themes feed through into the precious metals hedge. 

Gold News

XRP price will dip before it breaks out

A brief technical and on-chain analysis on XRP price. Here, FXStreet's analysts evaluate how Ripple bulls take control.

Read more

UK September CPI Inflation Preview: Will rising price pressures boost British pound?

Annual CPI in UK is expected to stay unchanged at 3.2% in September. BoE rate hike prospects have been lifting the British pound. GBP/USD could continue to push higher with a daily close above 1.3850.

Read more

Forex MAJORS

Cryptocurrencies

Signatures