GBP/USD Forecast: Further losses likely with a drop below 1.3100.

 GBP/USD has started to edge lower ahead of key US data.Sellers could take action in case the pair drops below 1.3100.

Investors remain cautious ahead of the weekend amid escalating geopolitical tensions.

GBP/USD has struggled to make a decisive move in either direction on Thursday and has started to edge lower in the early European session on Friday. The pair is closing in on 1.3100 support and the bearish pressure could increase in case that level fails.

Escalating geopolitical tensions on Russia’s decision to force buyers to pay for Russian gas in roubles forced investors to seek refuge late Thursday. Moreover, Russian forces are reportedly relocating and reorganising rather than pulling back, reviving concerns over a prolonged military conflict.

A risk-averse market environment is likely to cause GBP/USD to stay under bearish pressure and the US jobs report could further weigh on the pair. A positive shift in risk sentiment accompanied by an NFP-inspired dollar weakness could open the door for a rebound but this seems to be the less likely scenario.

GBP/USD Technical Analysis.

The Relative Strength Index (RSI) indicator on the four-hour chart is edging lower below 50 and GBP/USD stays below the 100-period and the 50-period SMA, pointing to a bearish shift in the near-term technical outlook.

1.3100 (psychological level, Fibonacci 23.6% retracement of the latest downtrend) aligns as key support. With a daily close below that level, additional losses toward 1.3050 (static level) and 1.3000 (psychological level, static level) could be witnessed.

On the upside, 1.3135 (100-period SMA) could be seen as interim resistance before 1.3160 (static level, Fibonacci 38.2% retracement, 50-period SMA) and 1.3200 (psychological level, Fibonacci 50% retracement).

EUR/USD fails to capitalize on hot EU inflation data.EUR/USD stays under modest bearish pressure and continues to trade near the mid-1.1000s on Friday. The data from the eurozone showed that the annual HICP inflation jumped to 7.5% in March from 5.9% in February. Investors now await US March Nonfarm Payrolls report.


GBP/USD remains below 1.3150 amid firmer USD, yields, focus on NFP.GBP/USD is keeping its range below 1.3150 ahead of the US NFP. The cautious market mood is underpinning the safe-haven US dollar amid a rebound in the Treasury yields. GBP bulls have shrugged off the upbeat UK Q4 GDP. 


Gold remains at the mercy of yields ahead of all-important US NFP.Gold price is treading water as the bond rout resumes, propelling yields higher. All eyes remain on the US NFP and Russia-Ukraine peace talks for fresh cues. Gold price remains capped below the horizontal 21-DMA amid bullish RSI.  

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