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GBP/USD remains below 1.3100 handle ahead of NFP

  • GBP/USD edges higher and snapped three consecutive days of losing streak.
  • The uptick lacked any strong bullish conviction amid fears of a no-deal Brexit.
  • Investors now look forward to the US monthly jobs report for a fresh impetus.

The GBP/USD pair traded with a mild positive bias on Friday, albeit lacked any strong follow-through and remained below the 1.3100 round-figure mark.

The pair built on the previous session's late rebound from the vicinity of the key 1.30 psychological mark and gained some positive traction on the last trading day of the week. The uptick lacked any obvious fundamental catalyst and largely shrugged off some follow-through US dollar appreciation.

The upside remains limited

The greenback remained supported by the de-escalation of geopolitical tensions in the Middle East after the US President Donald Trump on Wednesday announced fresh economic sanctions on Iran rather than signalling any further military action against the Islamic Republic.

Meanwhile, a subdued action around the US Treasury bond yields kept a lid on any strong gains for the USD and turned out to be one of the key factors that provided a modest lift to the pair ahead of Friday's important release of the closely watched US monthly jobs report – NFP.

However, concerns that Britain might crash out of the European Union at the end of this year held the GBP bulls from placing any aggressive bets. This coupled with the BoE Governor Mark Carney's overnight dovish sounding comments further collaborated towards capping the upside for the major.

Hence, it will be prudent to wait for some strong follow-through buying, possibly beyond the 1.3100 round figure mark, before traders start positioning for any further near-term recovery back towards the 1.3160-65 horizontal resistance en-route the 1.3200 round figure mark.

Technical levels to watch

 

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