- The GBP/USD pair is poised to end the Thursday session with gains of 0.70%.
- US jobless claims take some pressure off the Federal Reserve as job market cools.
- GBP/USD Price Analysis: Holds bearish bias unless bulls recapture 1.2000.
He GBP/USD rebounds from lows of 1.1802 and breaks above 1.1900, following Powell’s two-day testimony in US Congress. Although Powell’s stance turned hawkish, Thursday’s US data could help the Fed to gradually raise rates, although more confirmation is needed in Friday’s Nonfarm Payrolls. At the time of writing, GBP/USD is trading at 1.1905 after hitting a low of 1.1828.
Rising jobless claims improved market sentiment, so GBP rises
In data revealed by the BLS, Jobless Claims for the week ending March 4 were 211,000 higher than expected at 195,000. Despite Wednesday’s strong ADP report and more job openings than anticipated, rising jobless claims could ease labor market tightness. A negative US Nonfarm Payrolls report, coupled with elevated jobless claims, could reduce the need for the Federal Reserve (Fed) to tighten conditions at a faster pace.
The US Dollar Index (DXY) lost 0.40% to 105.225, putting a tailwind on the previously battered British Pound (GBP). Also, US Treasury yields are easing ahead of key employment and inflation data next Tuesday.
In the UK, employment will be reported on March 14. In addition, Chancellor of the Exchequer, Jeremy Hunt, will announce the spring budget. On the other hand, money market futures estimate a 91% chance that the Bank of England will raise rates by 25 basis points at its next meeting on March 23.
GBP/USD Technical Analysis
After GBP/USD fell to fresh lows at 1.1802, the pair recovered some ground but hit an uptrend line; previous support turned into resistance around 1.1930. The daily EMAs reinforced the downtrend after the formation of a deadly cross on February 3, exacerbating GBP/USD’s decline. Also, for a bullish continuation, GBP/USD must conquer 1.2000. Conversely, GBP/USD’s first support would be 1.1900, which, once broken, could pave the way for a retest of year-long lows and 1.1800.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
