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GBP/USD Soft but Holds Above $1.3800/1.3759

GBP
MNI (London)
  • Release Friday of stronger than forecast US employment data provided the USD with an added boost, which in turn applied further downside pressure on GBP/USD (which had seen a low earlier in Europe of $1.3789) that took it to a react low of $1.3779.
  • Rate bounced sharply to $1.3870 before closing the week at $1.3840.
  • Asia pressed rate down to $1.3811 before it recovered to $1.3866. Fresh USD demand took rate down to $1.3809 with recovery effort capped at $1.3840, opening Europe around $1.3812.
  • Support seen between $1.3810/00 ahead of $1.3779/76(Mar05 low/Feb12 low), a break below to expose the Jan27 $1.3759 high(break out level).
  • Resistance $1.3866/70, $1.3900, $1.3920/25.
  • UST yields, Fed speak and equity performance remain key market drivers.
  • A light UK data calendar Monday, BOE MPC Bailey to speak at 1000GMT.
  • Move lower in GBP/USD seen as a USD driven move, GBP still showing underlying buoyant tone elsewhere with EUR/GBP able to hold below its key 10-dma, currently at Gbp0.8634.
  • MNI Techs: Cable remained soft Friday. Price has cleared the 20-day EMA and in turn has also breached a number of near-term support levels. Focus is on $1.3760 next, the 50-day EMA. Clearance of this average would leave the bull channel support at $1.3711 exposed. The channel is drawn off the Nov 2, 2020 low and a move below this support would highlight an important short-term reversal. Firm resistance is at $1.4017, Mar 4 high.
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets
MNI London Bureau | +44 203-586-2231 | john.webb@marketnews.com
BulletMarketsForeign Exchange Bullets

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