The GBPUSD has remained on the defensive after rebounding from a six-week low and is holding onto slight gains recently.

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• GBP/USD stays defensive after bouncing off six-week low, clings to mild gains of late.

The pair currently trades last at 1.26882.

The previous day high was 1.2715 while the previous day low was 1.2617. The daily 38.2% Fib levels comes at 1.2654, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2677, expected to provide support.

GBP/USD sticks to mild gains around 1.2700 as market players brace for the top-tier UK/US statistics on early Tuesday. That said, the Cable pair recently bounced off the lowest level in 1.5 months amid the US Dollar’s pullback but fails to extend the recovery moves amid cautious mood in the markets ahead of the data, as well as due to mixed concerns about the frontline risk catalysts.

That said, the US Dollar Index (DXY) retreats from the highest level in five weeks, printing the first daily loss in four around 103.05 by the press time, after witnessing downbeat inflation clues. That said, the New York Fed’s one-year inflation expectations eased to 3.5% for July, down three points by falling to the lowest level since April 2021. New York Fed survey, however, also suggested confidence in positive labor market conditions and economic transition.

Apart from that, the comments from US Treasury Secretary Janet Yellen, who turned down fears about the US economy emanating from a likely slowdown in China, appear to favor the sentiment and favor the GBP/USD bulls of late. Even so, US Treasury Secretary Yellen cited the risks to the global economic developments from China’s slowdown, the Russia-Ukraine war and climate change-related disasters, as well as their spillover effects.

It should be noted that a slew of China data and comments from China’s Stats Bureau Official recently flagged economic fears about the world’s second-largest economy and prod the risk-on mood.

At home, the UK’s Chartered Institute of Personnel and Development (CIPD) released details of their latest survey while stating that the human resources executives expected to increase basic pay rates by a median of 5% – unchanged from the previous two quarters and the joint-highest readings since the survey started in 2012, per Reuters. The news increases the hawkish bias about the Bank of England (BoE) after the upbeat UK growth numbers published the last week.

Against this backdrop, the S&P500 Futures print mild gains and the US 10-year Treasury bond yields seesaw around the highest level since November 2022, marked the previous day.

Looking forward, a likely unchanged UK Unemployment Rate for three months to June, at 4.0%, will jostle with an expected improvement in the Average Earnings for three months to June.

GBP/USD remains within a six-week-old ascending triangle bullish chart formation, currently between 1.2775 and 1.2630, amid bearish MACD signals.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2691 at the time of writing. Pair opened at 1.2684 and is trading with a change of 0.06% % .

The pair is trading below its 20 Daily moving average @ 1.2805, below its 50 Daily moving average @ 1.2769 , above its 100 Daily moving average @ 1.2613 and above its 200 Daily moving average @ 1.2357

The previous day high was 1.2715 while the previous day low was 1.2617. The daily 38.2% Fib levels comes at 1.2654, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2677, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.2629, 1.2573, 1.253
• Pivot resistance is noted at 1.2727, 1.277, 1.2825

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