• Investors looked past an unexpected fall in the UK unemployment rate.
• UK foreign secretary Jeremy Hunt’s Brexit comments prompt some selling.
• A modest USD uptick further contributed to the intraday retracement.
The GBP/USD pair erased a major part of early gains and now seems to have entered a consolidation phase, just above 50-hour SMA.
The pair did get a minor boost during the early European session and spiked to an intraday high level of 1.2828 after the latest UK jobs report showed that the unemployment rate unexpectedly fell to a new 43 year-low level of 4.0% in three months to June.
The uptick was quickly sold into as additional details revealed that total annual wage growth slowed to a nine-month low of 2.4%, below forecasts for it to hold at 2.5%.
Adding to this, a modest pickup in the US Dollar demand and comments by the UK foreign secretary Jeremy Hunt, saying that risk of a no-deal Brexit has been increasing, further collaborated towards keeping a lid on any meaningful up-move.
The retracement slide, however, seems to have found a decent support at 50-hourly SMA, near the 1.2765-60 region as market participants now start repositioning for Wednesday's important macro releases - the latest UK consumer inflation figures and the US monthly retail sales data.
Technical levels to watch
Any subsequent slide below mid-1.2700s might continue to find support near the 1.2725-20 region, which if broken might now open room for an extension of the pair's near-term depreciating slide.
On the flip side, momentum back above 1.2780 level, leading to a subsequent break through the 1.2800 handle could assist the pair to aim back towards retesting session highs resistance, near the 1.2825-30 supply zone.
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 regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.