GBP/USD refreshes daily top on dismal NFP print, struggles to find acceptance above 1.3300
- GBP/USD attracted some dip-buying near mid-1.3200s and shot to a fresh daily high in the last hour.
- Disappointing headline NFP print prompted some USD selling and provided a modest lift to the pair.
- Brexit uncertainties, hawkish Fed expectations helped limit the USD losses and capped the upside.
The GBP/USD pair shot to a fresh daily high in reaction to dismal US jobs data, albeit struggled to capitalize on the move or find acceptance above the 1.3300 mark.
Having dropped to a three-day low earlier this Friday, the GBP/USD pair attracted some dip-buying in the vicinity of mid-1.3200s and got an additional boost during the early North American session. The latest leg of a sudden spike over the past hour or so followed the release of the closely-watched US NFP report, which showed that the economy added 210K jobs in November. This was well below consensus estimates pointing to a reading of 550K and the previous month's upwardly revised reading of 546K.
Additional details revealed that Average Hourly Earnings fell short of market expectations and led to a modest US dollar weakness, which, in turn, provided a goodish lift to the GBP/USD pair. However, the disappointment, to a larger extent, was offset by a larger than expected drop in the unemployment rate, which fell to 4.2% from 4.6% in October. Adding to this, the fact that the Fed has acknowledged a sufficient labor market recovery to permit higher interest rates helped limit any deeper losses.
On the other hand, persistent Brexit-related uncertainties continued acting as a headwind for the British pound. This was seen as another factor that kept a lid on any meaningful upside for the GBP/USD pair. This makes it prudent to wait for a strong follow-through buying beyond the 200-hour SMA, currently around the 1.3320-25 region, before positioning for any further appreciating move. Next on tap will be the release of the US ISM Services PMI, which might provide some impetus to the pair.
Technical levels to watch