Gaining ground on weak US jobs data

• GBP/USD is recovering from a daily low of 1.3031, with momentum turning bullish as the RSI points higher.
• Bulls need to clear the resistance at 1.3111 and 1.3143 to target the key psychological level of 1.3200.
• A break below 1.3000 would expose the 50-DMA at 1.2953, with additional support at 1.2872 and 1.2810 (100-DMA).

Sterling advanced modestly against the US dollar on Thursday after economic data showed that US factory inflation was much stronger than forecast. That and a softer US jobs report weighed on the money. GBP/USD is trading at 1.3078 after hitting a daily low of 1.3031.

GBP/USD Price: Technical Insights

After hitting a three-week low of 1.3001, GBP/USD bounced back to the mid-range of 1.3000-1.3100 after UK economic data showed the economy cooling.

Momentum shows buyers stepping into the market in the form of the Relative Strength Index (RSI), which, on the verge of turning bearish, has turned around, aiming higher.

If the bulls want to regain control, they need to recapture the September 11 peak of 1.3111. This would expose the current week’s top at 1.3143, followed by 1.3200.

Conversely, for a bearish continuation, if GBP/USD breaks below 1.3000, the first support would be the 50-day moving average (DMA) at 1.2953. On further weakness, the next stop would be the August 13 high support, which was converted at 1.2872, ahead of the challenge of 1.2810, the 100-DMA.

GBP/USD Price Action – Daily Chart