- GBP/USD claws back towards 1.2800, extends into a thin but determined recovery.
- Political risk weighs heavily over Cable, with UK election results due late in the US session.
- US markets are dark for the Independence Day holiday, and volumes remain thin.
GBP/USD is fighting back into the high end as the Greenback broadly recedes on Thursday. Market volumes are drawn tight with US exchanges shuttered in observation of the US Independence Day holiday, and Cable traders are awaiting vote tallies in the UK’s Parliamentary Elections, which are slated to begin releasing late in the US market window.
The UK’s Labour Party is broadly expected to sweep to a massive victory on Thursday, upending 14 consecutive years of Conservative Party leadership. According to advance polling released just before election day, the British populace is forecast to reject current-Prime Minister Rishi Sunak’s Tories roundly. US Nonfarm Payrolls (NFP) jobs data is also slated for release on Friday, promising a heady end to the trading week.
Daily digest market movers: Darkened US markets leave UK elections front and center
- UK Parliamentary Election is widely expected to unseat the long-running Conservative Party and incumbent Prime Minister Rishi Sunak in favor of the Labour Party’s Keir Starmer.
- Advance polling suggests Labour is going on a strong sweep this election, projected to win around four hundred seats out of the UK’s 650 available seats.
- PM Rishi Sunak marks the fourth straight Tory leader in just eight years.
- US NFP net job gains are forecast to ease to 190K in June, down from the previous 272K.
- US Average Hourly Earnings are also expected to moderate further, forecast to tick down to 0.3% MoM in June, down from the previous 0.4%.
British Pound PRICE Today
The table below shows the percentage change of British Pound (GBP) against listed major currencies today. British Pound was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.22% | -0.14% | -0.32% | -0.20% | -0.32% | -0.24% | -0.20% | |
| EUR | 0.22% | 0.08% | -0.10% | 0.02% | -0.06% | -0.05% | 0.07% | |
| GBP | 0.14% | -0.08% | -0.21% | -0.07% | -0.17% | -0.13% | -0.04% | |
| JPY | 0.32% | 0.10% | 0.21% | 0.12% | -0.01% | 0.06% | 0.14% | |
| CAD | 0.20% | -0.02% | 0.07% | -0.12% | -0.11% | -0.05% | 0.02% | |
| AUD | 0.32% | 0.06% | 0.17% | 0.00% | 0.11% | 0.07% | 0.14% | |
| NZD | 0.24% | 0.05% | 0.13% | -0.06% | 0.05% | -0.07% | 0.07% | |
| CHF | 0.20% | -0.07% | 0.04% | -0.14% | -0.02% | -0.14% | -0.07% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the British Pound from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent GBP (base)/USD (quote).
Technical analysis: GBP/USD tests higher, clawing back ground amid thin recovery
GBP/USD is extending into a thin but determined recovery on Thursday, stretching into a third day of gains after arresting near-term declines just north of the 200-day Exponential Moving Average (EMA) at 1.2610.
Cable has drifted into the low end after seeing a technical rejection from a supply zone priced in above 1.2800, but unmotivated bears have failed to spark a meaningful decline into the last major swing low into the 1.2300 handle.
GBP/USD hourly chart
GBP/USD daily chart
Economic Indicator
Nonfarm Payrolls
The Nonfarm Payrolls release presents the number of new jobs created in the US during the previous month in all non-agricultural businesses; it is released by the US Bureau of Labor Statistics (BLS). The monthly changes in payrolls can be extremely volatile. The number is also subject to strong reviews, which can also trigger volatility in the Forex board. Generally speaking, a high reading is seen as bullish for the US Dollar (USD), while a low reading is seen as bearish, although previous months' reviews and the Unemployment Rate are as relevant as the headline figure. The market's reaction, therefore, depends on how the market assesses all the data contained in the BLS report as a whole.
Read more.Next release: Fri Jul 05, 2024 12:30
Frequency: Monthly
Consensus: 190K
Previous: 272K
Source: US Bureau of Labor Statistics
America’s monthly jobs report is considered the most important economic indicator for forex traders. Released on the first Friday following the reported month, the change in the number of positions is closely correlated with the overall performance of the economy and is monitored by policymakers. Full employment is one of the Federal Reserve’s mandates and it considers developments in the labor market when setting its policies, thus impacting currencies. Despite several leading indicators shaping estimates, Nonfarm Payrolls tend to surprise markets and trigger substantial volatility. Actual figures beating the consensus tend to be USD bullish.
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