#GBPUSD @ 1.24110 has shown some recovery as USD Index fails to extend recovery. (Pivot Orderbook analysis)

…
This is a premium post.
[s2If !current_user_can(access_s2member_level4)]Please register for PREMIUM VERSION HERE to read full post below containing analysis. In case of any error or you think you are not able to read the full post below, please email us at support#nehcap.com [lwa][/s2If] [s2If current_user_can(access_s2member_level4)]

• GBP/USD has shown some recovery as USD Index fails to extend recovery.
• Decelerating the UK labor cost index will provide some relief to BoE policymakers.
• US Retail Sales report showed that demand for costly items, which involves the cost of financing remained weak, remained weak.

The pair currently trades last at 1.24110.

The previous day high was 1.2546 while the previous day low was 1.2399. The daily 38.2% Fib levels comes at 1.2455, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.249, expected to provide resistance.

The GBP/USD pair has witnessed some buying interest after dropping below the round-level support of 1.2400 in the Asian session. The Cable is showing some recovery, however, a wait-and-watch approach looks more feasible as the upside structure in US Dollar Index (DXY) has not been dented yet.

The Pound Sterling is expected to remain in action ahead of the release of the United Kingdom Employment data (Mar). Three-month Unemployment Rate is likely to remain steady at 3.7%. The Claimant Count Change is expected to decline by 11.8k, higher than the former release of 11.2K. Continuous addition of job seekers into the labor force indicates tight labor market conditions.

Apart from that, Average Earnings excluding bonuses are expected to soften to 6.2% vs. 6.5%. Investors should be aware of the fact that factors that have been fueling inflationary pressures in the UK regions are food inflation and higher employment bills due to severe labor shortage and decelerating labor cost index will provide some relief to the Bank of England (BoE) policymakers.

Meanwhile, S&P500 futures have registered some gains in the Asian session, portraying a recovery in the risk-on mood. The US Dollar Index (DXY) is facing hurdles in extending its recovery above 101.80. Also, demand for US government bonds has shown some recovery as investors are starting to digest one more rate hike expectation from the Federal Reserve (Fed). The 10-year US Treasury yields have eased to near 3.51%.

Contracting US Retail Sales released on Friday failed to ease chances of more rate hikes from the Fed. Scrutiny of the Retail Sales report showed that demand for costly items, which involves cost of financing remained weak, remained weak.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2406 at the time of writing. Pair opened at 1.2412 and is trading with a change of -0.05 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.237, 50 SMA 1.2173, 100 SMA @ 1.2182 and 200 SMA @ 1.1913.

The previous day high was 1.2546 while the previous day low was 1.2399. The daily 38.2% Fib levels comes at 1.2455, expected to provide resistance. Similarly, the daily 61.8% fib level is at 1.249, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 1.2359, 1.2306, 1.2212
• Pivot resistance is noted at 1.2506, 1.26, 1.2653

[/s2If]
Join Our Telegram Group