GBP/USD Price Forecast: Reflects strength above 20-day EMA ahead of UK job data

The British Pound (GBP) gained 0.22% and reached around 1.3333 against the US Dollar (USD) during the Asian session on Tuesday. Market participants are watching the UK labor market data scheduled for release at 06:00 GMT, three months ending in August. The International Labour Organization (ILO) Unemployment Rate rose to 5% from 4.9% in the previous three months ending July.

Meanwhile, Average Earnings Including Bonuses, a key gauge of wage growth, dipped to 3.8% Year-on-Year (YoY) from 3.9% in the previous period. However, Excluding Bonuses, a measure of wage growth, saw an increase to 3.6% YoY from 3.5% in the quarter ending July. The labor market data will likely influence Bank of England (BoE) monetary policy expectations, with the upcoming Consumer Price Index (CPI) data for September on Wednesday considered the major trigger.

Other UK economic releases to watch include Retail Sales for September and the preliminary S&P Global PMI for October, both expected on Friday. Meanwhile, the US Dollar is facing headwinds due to concerns about Artificial Intelligence (AI) spending by US hyperscalers, causing the US Dollar Index (DXY) to fall 0.2% to near 101.77.

On the daily chart, GBP/USD is trading at 1.3333 and holds above the 20-day exponential moving average (EMA) at 1.3289, indicating a slightly bullish outlook for the near term. The Relative Strength Index (14) at 52.8 is just above the neutral band, suggesting upside momentum is constructive but not stretched. If the pair breaks below the 1.3289 level, it could weaken the current positive stance and signal a more corrective phase.