GBP/USD Fluctuates in a Narrow Range Amid Economic DataOn Tuesday, the GBP/USD pair traded within a narrow range between 1.3077 and 1.3080, showing a slight rebound from a demand area. Despite the modest movement, the market is still waiting for more significant developments before making larger moves.
UK Economic Data Supports GBP Stability
Earlier on Tuesday, the Office for National Statistics (ONS) released key employment data, which provided some support for the British Pound. The ILO Unemployment Rate for the three months leading up to August eased to 4.0%, down from 4.1% in July. Additionally, Employment Change figures showed an increase of 373K in August, up from 265K in July, indicating continued resilience in the labor market.
However, the report also showed a slight softening in wage inflation, as the Average Earnings excluding Bonus dropped to 4.9%, down from 5.1%. While wage growth moderated, the overall labor market data was positive enough to give the Pound some stability in the early session.
US Data and Market Outlook
The economic calendar is light for the US on Tuesday, with no major data releases expected. The market’s focus will shift to Thursday when the USD Core Retail Sales (m/m), Retail Sales (m/m), and Unemployment Claims are due to be released. These reports are expected to bring more volatility to the GBP/USD pair, as they will provide insights into the strength of the US economy and the potential direction of the US Dollar.
Until these data are released, the British Pound may continue to hold onto small gains, but the overall market mood remains cautious.
Technical Outlook: Bearish Momentum Ahead?
From a technical standpoint, GBP/USD remains under bearish pressure, and we anticipate a potential continuation of this trend. While the pair has found some temporary support around the current levels, we expect the bearish momentum to continue until the pair reaches a more solid demand zone around the 1.2800 level.
Until the pair approaches this level, we are refraining from opening any new positions, waiting for more clarity on market direction and potential retracement signals.
Conclusion
GBP/USD is holding steady in a narrow range as UK labor market data provides temporary support. However, the overall outlook remains cautious, with the potential for further bearish pressure. Investors should keep an eye on Thursday’s US data releases, which could trigger more significant movements in the pair. For now, we are waiting for GBP/USD to reach a stronger demand area before considering any new positions.
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