GBP/USD: Firmer near 1.2230 amid weaker USD, eyes UK jobs

The bulls face exhaustion after the latest upsurge, allowing a brief phase of upside consolidation in GBP/USD well above 10-DMA located at 1.2202.

The spot keeps its bid tone intact in the European session, with the sentiment bolstered by positive European equities, as traders eagerly await the UK jobs data for fresh impetus on the prices.

The GBP/USD pair rallied hard in early European trading, extending its Asian rebound above 1.2250 levels, on the back of a short squeeze, as markets resort to adjusting their positions heading into the FOMC decision.

From a wider perspective, the pound remains exposed to further downside risks on ‘Hard Brexit’ concerns, after the UK parliament paved the way for the Article 50 trigger by PM May. Meanwhile, Sturgeon’s plans to hold the second Scottish independence referendum also keeps the GBP bulls on the edge.

GBP/USD Levels to consider            

Carol Harmer at Charmer Trading Academy noted, “We have reached our 1.2250 target....we have backed away.....but we are looking good on the daily charts....although overbought on the 60 min...well that was ok....4 hrly charts look good...Now all we have to do is break and hold above 1.2250 and this will send a stern message to the sellers to back of and leave Cable alone...then we can trade to 1.2281 initially with potential for 1.23 quite quickly....I still believe in this currency whilst above 1.21/1.2090....I really do....and I believe that there is more to go on the topside...”