GBPUSD jumped to 1.2200 in the European session on Friday.
GBPUSD rose to 1.2200 on Friday after finishing in positive territory on Wednesday and Thursday. The pair’s near-term technical picture shows additional upside potential. But investors may hold off on more USD weakening until the September employment report disappoints.
The minor recovery in risk sentiment and another step lower in the 10-year. US Treasury bond yield made it tough for the USD to maintain its resilience against its peers. competitors on Thursday.
The FTSE 100 Index in the United Kingdom began marginally higher on Friday. While US stock index futures turned positive following a negative Asian session.
Nonfarm Payrolls (NFP) in the United States are expected to increase by 170,000 in September. If the NFP falls below 150,000. And reaffirms the labor market’s weakening circumstances, the USD may face fresh negative pressure. In such scenario, risk flows might dominate financial market action. Due to dovish Federal Reserve predictions, providing an extra lift to the GBPUSD.
However, an increase of 200,000 or more in NFP might force US rates to gain traction. Allowing the USD to regain strength ahead of the weekend.
GBPUSD Technical Outlook
GBPUSD was last spotted trading at 1.2200. Which corresponds to the Fibonacci 23.6% retracement of the most recent slump. If the pair climbs above that level and establishes it as support, the 4-hour chart’s 100-period Simple Moving Average (SMA) might be considered. As the next recovery objective at 1.2250, ahead of 1.2300 (Fibonacci 38.2% retracement).
On the downside, 1.2150 (50-period SMA) serves as an immediate support level. Before 1.2100 (upper limit of the broken descending regression channel) and 1.2050 (midpoint of the descending channel).
Meanwhile, the 4-hour chart’s Relative Strength Index (RSI) indicator is comfortably above 50, indicating that GBPUSD stays positive in the short term.
