GBP/USD remains below 1.2800 in the European session on Monday as escalating geopolitical tensions drive investors to seek refuge at the beginning of the week. The US economic docket will highlight ISM Services PMI data for July.
GBP/USD closed positively on Friday but struggled to maintain its recovery momentum at the start of the week. Currently, the pair is trading slightly above 1.2750.
British Pound PRICE Last 7 days
The table below displays the percentage change of the British Pound (GBP) against major currencies over the past 7 days, with the Pound weakest against the Japanese Yen.
The selling pressure on the US Dollar helped GBP/USD recover some of its weekly losses on Friday. The latest US Nonfarm Payrolls report showed a rise of 114,000 jobs in July, missing expectations and leading to market speculation of a 50 basis points Federal Reserve rate cut in September.
Geopolitical tensions intensified over the weekend with reports of Iran preparing to attack Israel, causing concern among investors about potential market impacts. This led to significant losses in stock markets early Monday.
In the upcoming US economic docket, the ISM Services PMI data for July is anticipated to show an improvement. A disappointing PMI print could weaken the USD further and provide support for GBP/USD, but overall market sentiment will play a crucial role in the pair’s movement.
GBP/USD Technical Analysis
The Relative Strength Index (RSI) indicator suggests a bearish outlook for GBP/USD, with support levels at 1.2710-1.2700 and resistance levels at 1.2780, 1.2800, and 1.2830.
Risk Sentiment FAQs
Understanding “risk-on” and “risk-off” market dynamics is essential for investors. During “risk-on” periods, stock markets and certain currencies rise, while “risk-off” periods see a shift to safer assets like Bonds, Gold, and safe-haven currencies.
Overall, geopolitical tensions, economic data, and market sentiment will continue to influence GBP/USD movements in the coming days. Stay informed and prepared for potential market shifts.