GBP/USD recaptures 1.2050 ahead of UK jobs data

GBP/USD recovers losses to trade back above 1.2050 amid risk reset.
The US dollar eases while the US Treasury yields remain sluggish.
Critical UK economic data are awaited ahead of the Fed minutes.

Dhwani Mehta FXStreet

GBP/USD has paused its three-day sell-off near mid-1.2000s, as bears take breather ahead of the UK employment data release. The UK ILO Unemployment Rate is seen steady at 3.8% in June while the average hourly earnings ex-bonus are likely to tick higher from 4.3% to 4.5% in June.

The last jobs report came in strong and therefore lifted odds for a 50 bps BOE rate hike in September. Ever since, the energy crisis in the UK and Europe has worsened while the global economic outlook has turned dour. Besides, the UK jobs data, Wednesday’s inflation data will hold the key for the BOE’s next rate hike trajectory.

On the USD side of the equation, markets are seeing a bit of a risk recovery amid chatters over potential stimulus from China after the country reported dismal activity numbers a day ago. Although escalating China-Taiwan tensions keep investors unnerved, especially after Beijing sanctioned Taiwanese officials on Tuesday for supporting Taiwan's independence. Democratically self-ruled Taiwan continues to reject China's claim of sovereignty.

The cautious optimism is capping the recent upside in the US dollar against its major peers, with the US dollar index losing 0.07% on the day to trade at 106.48, as of writing. On Wednesday, the US Retail Sales and the Fed minutes will also grab attention, with a 50 bps September Fed rate hike seen as the best bet so far.

GBP/USD: Technical levels to consider

GBP/USD

Overview
Today last price	1.2058
Today Daily Change	0.0003
Today Daily Change %	0.02
Today daily open	1.2054

Trends
Daily SMA20	1.2104
Daily SMA50	1.2129
Daily SMA100	1.2415
Daily SMA200	1.2905

Levels
Previous Daily High	1.2148
Previous Daily Low	1.205
Previous Weekly High	1.2277
Previous Weekly Low	1.2048
Previous Monthly High	1.2246
Previous Monthly Low	1.176
Daily Fibonacci 38.2%	1.2088
Daily Fibonacci 61.8%	1.2111
Daily Pivot Point S1	1.202
Daily Pivot Point S2	1.1986
Daily Pivot Point S3	1.1922
Daily Pivot Point R1	1.2119
Daily Pivot Point R2	1.2183
Daily Pivot Point R3	1.2217

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

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