- GBP/USD drops back closer to the daily low amid the emergence of fresh USD buying.
- The upbeat US NFP data reaffirms Fed rate hike bets and acts as a tailwind for the buck.
- Concerns about the UK’s fiscal policy weigh on the GBP and contribute to the downtick.
The GBP/USD pair meets with a fresh supply during the early North American session and slides back closer to the daily low, below mid-1.1100s in reaction to the upbeat US employment details.
The US dollar reverses an intraday dip and climbs to a fresh weekly high after the headline NFP report showed that the US economy added 263K new jobs in September. The reading marks a notable slowdown from the 315K reported in the previous month, though surpasses consensus estimates for a reading of 250K.
Additional details revealed that the unemployment rate fell to 3.5% during the reported month from 3.7% in August, reaffirming hawkish Fed expectations. This, in turn, remains supportive of elevated US Treasury bond yields and underpins the greenback, which exerts some pressure on the GBP/USD pair.
Apart from rising bets for a more aggressive policy tightening by the Fed, the prevalent risk-off mood is seen as another factor benefitting the safe-haven buck. The British pound, on the other hand, is weighed down by concerns about the UK government's fiscal policy and looming recession risks.
The aforementioned fundamental factors suggest that the path of least resistance for the GBP/USD pair is to the downside. Hence, any attempted recovery might still be seen as a selling opportunity and runs the risk of fizzling out rather quickly.
Technical levels to watch
|Today last price||1.1211|
|Today Daily Change||0.0048|
|Today Daily Change %||0.43|
|Today daily open||1.1163|
|Previous Daily High||1.1384|
|Previous Daily Low||1.1113|
|Previous Weekly High||1.1235|
|Previous Weekly Low||1.0339|
|Previous Monthly High||1.1738|
|Previous Monthly Low||1.0339|
|Daily Fibonacci 38.2%||1.1216|
|Daily Fibonacci 61.8%||1.128|
|Daily Pivot Point S1||1.1056|
|Daily Pivot Point S2||1.0949|
|Daily Pivot Point S3||1.0785|
|Daily Pivot Point R1||1.1327|
|Daily Pivot Point R2||1.1491|
|Daily Pivot Point R3||1.1598|
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.