GBPUSD recovery efforts are likely to find firm resistance at 1.2600.
The GBPUSD is attempting to regain ground in the early European session after rebounding from session lows at 1.2540, while 1.2600 appears to be a difficult resistance area.
Sterling’s bears are still in charge, as the pair extended its decline from three-month highs above 1.2700 on Thursday. The safe-haven Dollar is benefiting from a deterioration in market mood caused by increased predictions of a worldwide economic downturn in 2024.
The dismal ADP report had no effect on the US dollar.
The worse US ADP employment report did not dent confidence in the USD, which is on course to reach a new high. This week has seen a remarkable recovery as monetary easing bets spread across the majority of the world’s major central banks.
Furthermore Investors are now looking forward to Friday’s Nonfarm Payrolls report for additional insight into the US labor situation.
Moreover In the UK, BoE Governor Bailey emphasized the need to hold interest rates at current levels for some time, despite mentioning the dangers to financial stability and the challenges to the global economy posed by China uncertainty.
Technical Outlook
Technically, the picture is bleak. Below 1.2600, the pair has confirmed a double-top at 1.2730, putting downward pressure on 1.2517 and 1.2460.
