British Pound flatlines near mid-1.3400s vs softer USD; looks to US NFP for fresh impetus
The GBP/USD pair attracts some dip-buyers during the Asian session on Friday, stalling the previous day's retracement slide from levels just above the 1.3500 psychological mark, or its highest level since mid-September.
The British Pound (GBP) remained relatively stable against the US Dollar (USD) near the 1.3400s range on Friday, awaiting key economic data from the United States. Market participants kept a cautious stance ahead of the US Nonfarm Payrolls (NFP) release, which will have a significant impact on US Dollar demand and the GBP/USD pair's trajectory.
The recent uptick in the USD can be attributed to the lower US bond yields and hopes for Iran diplomacy, which keeps the safe-haven USD in a weaker position. The upcoming US NFP report will provide fresh impetus to the GBP/USD pair, as traders anticipate potential moves from the Federal Reserve (Fed) in December. The positive economic backdrop, bolstered by the Bank of England's (BoE) interest rate hike and the reduction of fiscal crisis risks, serves as a tailwind for the GBP.
Technical analysis indicates a constructive near-term bias for the GBP/USD pair, with the pair currently trading above the 200-day Simple Moving Average (SMA) and key Fibonacci support levels. A break above the 61.8% Fibonacci level could propel the pair towards the 1.3560 mark, while a break below the 200-day SMA at 1.3421 might attract support from the 50.0% Fibonacci level at 1.3406.
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