Gbp/usd rises amid U.S. economic slowdown signals

GBPUSD Analysis

Performance after Wednesday
Period	Pct	Chg	Momentum
Wednesday	0.89%	114.7 Pips
Week to-date	0.71%	92 Pips
April	0.82%	106.1 Pips

Upcoming key events (London Time)

Fri 01:30 PM USD Nonfarm Payroll Employment
Fri 01:30 PM USD Average Hourly Earnings (12-mth)

What happened lately

In the United States, new orders for manufactured goods saw a decline in February, dropping to 0.6% from a revised 1.8% in January, as per the Census Bureau. This indicates a slowdown in manufacturing activity, reflecting possibly weaker demand or supply chain challenges. Additionally, the Job Openings and Labor Turnover Survey (JOLTS) highlighted a reduction in job openings in February, falling to 7.568 million from a revised 7.74 million in January, according to data from the Bureau of Labor Statistics. This suggests a cooling labor market, which may further signal a deceleration in economic momentum. Both indicators reflect a softer economic outlook for the U.S., potentially affecting investor sentiment and market stability.

The recent economic data from the United States, particularly the downturns in manufacturing orders and job openings, could affect the GBPUSD currency pair. A weaker U.S. economy might lead to expectations of more accommodative monetary policy actions by the Federal Reserve, such as interest rate cuts, to stimulate growth. This could put downward pressure on the U.S. dollar. Conversely, if the U.K. economy is perceived as relatively better or more stable, the British pound may gain strength against the dollar. Consequently, such developments can lead to an appreciation of the GBPUSD pair, as observed with its rise to 1.30303. However, the forthcoming U.S. Nonfarm Payroll Employment and Average Hourly Earnings reports are critical, as strong job growth or wage increases could bolster the dollar, potentially reversing some of this upward movement in GBPUSD. Traders will be looking closely at these high-impact events to gauge the future direction of the currency pair.

Latest from X (Twitter)

Tweets by Office for National Statistics

What can we expect from GBPUSD today?

GBPUSD on Wednesday rose 0.89% to 1.30303. Price is above 9-Day EMA while Stochastic is rising.

Updated daily direction for GBPUSD looks bullish as the pair ended higher after Wednesday trading session.

Looking ahead for the day, immediate upside resistance level is R1 at 1.30744 with break above could target R2 at 1.31185 or figure level area. While towards the downside, we are looking at daily low of 1.29000 as an important support. Break below this level could weaken the current bullish momentum. A break above 1.30313 may suggest continuation after recent positive movement.

For the week to-date, take note that GBPUSD is bullish as the pair continued to trade higher and is up by 0.71% over the past few days.

Key levels to watch out:

#GBPUSD Trending on Twitter

[custom-twitter-feeds hashtag=”#GBPUSD” num=3 showheader=false]