GBP/USD rallies amidst Greenback weakness on upbeat market mood

GBP/USD rebounds from a daily low of 1.2037, despite UK Services PMI and Composite figures indicating a contraction in business activity.
US ADP Employment Change report and ISM Non-Manufacturing PMI reveal a slowdown in private sector hiring and service sector activity, respectively.
Despite the lack of supportive UK economic data, the GBP finds support amidst a generally weakening US Dollar and positive market sentiment.

Christian Borjon Valencia FXStreet

The Pound Sterling (GBP) rallies against the US Dollar (USD) even though the latest round of UK economic data didn’t support the advance of Sterling, but overall weakness on the Greenback keeps most G8 FX currencies underpinned. The GBP/USD is trading at 1.2135 after sliding to a monthly low of 1.2037 earlier in the European session.

GBP/USD consolidates around 1.2140, as the Greenback's overall weakness and upbeat market sentiment overshadow uninspiring UK economic figures

An upbeat market sentiment is also boosting the British Pound. The latest UK economic docket showed that business activity slightly improved, as S& Global /CIPS revealed. The Services PMI and Composite figures jumped but remained below the 50 expansion/contraction threshold, it showed that consumer spending is shrinking.

In the United States, private sector hiring slowed in September, as indicated by the ADP Employment Change report, with a gain of 89,000 jobs. This figure was below the estimated 153,000 jobs and declined from August 177,000. Additionally, the ISM Non-Manufacturing PMI reported a business activity index of 53.6 in the services sector for September, which was as expected but decreased from the previous month's reading of 54.5.

GBP/USD Price Analysis: Technical outlook

The GBP/USD remains tilted to the downside from a daily chart standpoint. Still, price action during the last couple of days formed a ‘bullish engulfing’ candlestick chart pattern, suggesting that further upside is expected. Next, resistance emerges at the 1.2200 figure, followed by the October 2 high at 1.2219. Once those levels are cleared, the major could challenge September 29, the last cycle high at 1.2271, which could pave the way to test the 200-day moving average (DMA). Nevertheless, if GBP/USD remains below 1.2270, that could pave the way to test 1.2000, followed by the year-to-date (YTD) low of 1.1802.

GBP/USD

Overview
Today last price	1.2138
Today Daily Change	0.0061
Today Daily Change %	0.51
Today daily open	1.2077

Trends
Daily SMA20	1.2323
Daily SMA50	1.2557
Daily SMA100	1.2615
Daily SMA200	1.2437

Levels
Previous Daily High	1.2102
Previous Daily Low	1.2052
Previous Weekly High	1.2272
Previous Weekly Low	1.2111
Previous Monthly High	1.2713
Previous Monthly Low	1.2111
Daily Fibonacci 38.2%	1.2071
Daily Fibonacci 61.8%	1.2083
Daily Pivot Point S1	1.2052
Daily Pivot Point S2	1.2028
Daily Pivot Point S3	1.2003
Daily Pivot Point R1	1.2102
Daily Pivot Point R2	1.2127
Daily Pivot Point R3	1.2151

Author

Christian Borjon Valencia

FXStreet

Markets analyst, news editor, and trading instructor with over 14 years of experience across FX, commodities, US equity indices, and global macro markets.

GBP/USD clings to gains near 1.3400

GBP/USD retreats after reaching a three-week high above 1.3430, challenging the 1.3400 yardstick on Thursday. Although easing political uncertainty in the UK helps the quid limit its downside, escalating tensions in the Middle East support the Greenback, keeping Cable under scrutiny.

EUR/USD faces resistance around 1.1450

EUR/USD keeps the bid bias although it seems to have met a tough hurdle around 1.1450 on Thursday. The pair’s advance follows the bearish tone in the US Dollar despite escalating tensions in the Middle East and a broad-based cautious stance from market participants.

Gold flirts with two-day highs, approaches $4,130

Gold stages a modest rebound on Thursday, setting aside a three-day losing streak and managing to surpass the $4,100 mark per troy ounce. However, steady geopolitical tensions have revived concerns over persistently high global inflation, reinforcing expectations of higher rates across the board and somewhat curtailing the yellow metal’s upside potential.

Bitcoin stalls as mixed ETF flows, renewed US-Iran tensions cap upside

Bitcoin trades at $63,000 on Thursday, recovering slightly after facing rejection near $64,000. Renewed geopolitical uncertainty has dampened risk appetite, limiting BTC upside potential.

Japan may be changing its Yen strategy, but markets don’t look scared

Japan may be changing its intervention playbook, but that might not be enough to rescue the battered Yen. With USD/JPY hovering at four-decade highs, the currency’s weakness is being driven less by speculative pressure and more by a powerful structural force: the wide US-Japan rate gap.

Bye, forward guidance: How to trade when central banks choose silence

Central banks have spent years telling markets what might come next. Now, traders face the possibility that they say a lot less. From the Federal Reserve to the European Central Bank and the Bank of England, policymakers are pushing back against forward guidance.