GBPUSD Remains in Red; Bears Face Resistance at Daily Cloud Top, Awaiting US Labor Data for Fresh Signals

Cable Remains in the Red Early Friday; Bears Face Resistance at Daily Cloud Top, Awaiting US Labor Data

GBPUSD continued to decline on Friday morning, following a 0.9% drop on Thursday, marking the biggest daily loss since April 10. The recent risk aversion has weighed on the pound.

Bears have driven the pair to a one-month low but encounter support at 1.2706, the top of the thick ascending daily cloud. Here, the pair may pause as daily indicators are becoming oversold and negative momentum shows signs of fading.

The near-term outlook is likely to remain subdued until the release of US labor data later today, which will provide fresh direction signals.

US Nonfarm Payrolls are expected to increase by 176,000 in July, down from June’s 206,000, suggesting a slower but still healthy growth pace. Unemployment and average earnings are anticipated to remain steady at 4.1% and 0.3%, respectively.

Stronger-than-expected NFP data could dampen prospects for further rate cuts and bolster the dollar, adding pressure on the pound. Conversely, weaker job data could lead to sterling appreciation.

A break and close within the daily cloud would reinforce the negative structure and signal a continuation of the broader downtrend from the July 17 peak of 1.3044. Key short-term support at 1.2615, a higher base from late June and early July, will be in focus.

The broken Fibonacci support at 1.2779, now acting as solid resistance, is followed by the daily Tenkan-sen at 1.2822.

Res: 1.2751; 1.2779; 1.2800; 1.2822
Sup: 1.2706; 1.2670; 1.2615; 1.2580