GBP/USD surrenders weaker headline NFP-led gains to three-week tops

GBP/USD struggled to capitalize on the post-NFP bullish spike to fresh three-week tops.
The US economy added fewer jobs than expected, the unemployment rate fell to 5.2%.
COVID-19 woes extended some support to the safe-haven USD and capped the upside.

Haresh Menghani FXStreet

The GBP/USD pair faded the post-NFP bullish spike and quickly retreated around 40 pips from three-week tops, around the 1.3865 region touched in the last hour.

Following a brief consolidation through the first half of the trading action, the GBP/USD pair caught some fresh bids and built on the previous day's bullish breakout momentum through the 1.3800 mark. The US dollar remained depressed amid doubts over the US labour market recovery, which, in turn, pushed the major higher for the third successive day.

The USD selling pressure picked up pace following the release of the closely-watched NFP report, which showed that the economy added 235Knew jobs in August as against 750K anticipated. The disappointing headline print, to some extent, was offset by an upward revision of the previous month's reading to 1053K from 943K reported originally.

Additional details showed that the unemployment rate dropped to 5.2% from 5.4% in July, in line with market expectations. Moreover, Average Hourly Earnings data also came in better than consensus estimates and indicated robust growth. Nevertheless, the data might have forced investors to further push back expectations for an imminent taper announcement.

Meanwhile, the incoming softer US economic data now seems to have raised concerns about the risks associated with the fast-spreading Delta variant of the coronavirus. This was evident from a modest pullback in the US equity futures, which extended some support to the safe-haven USD and capped the upside for the GBP/USD pair, at least for now.

Technical levels to watch

GBP/USD

Overview
Today last price	1.3825
Today Daily Change	-0.0009
Today Daily Change %	-0.07
Today daily open	1.3834

Trends
Daily SMA20	1.3775
Daily SMA50	1.3809
Daily SMA100	1.3922
Daily SMA200	1.3812

Levels
Previous Daily High	1.384
Previous Daily Low	1.3767
Previous Weekly High	1.3781
Previous Weekly Low	1.3612
Previous Monthly High	1.3958
Previous Monthly Low	1.3602
Daily Fibonacci 38.2%	1.3812
Daily Fibonacci 61.8%	1.3795
Daily Pivot Point S1	1.3787
Daily Pivot Point S2	1.3741
Daily Pivot Point S3	1.3715
Daily Pivot Point R1	1.386
Daily Pivot Point R2	1.3886
Daily Pivot Point R3	1.3932

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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