GBP/USD chalks in a fifth straight gain on Wednesday

GBP/USD

FXStreetAug 22, 2024 12:53 AM

GBP/USD breached 1.3100 on Wednesday as the bull march continues.
The Pound Sterling is enjoying a healthy bid as the US Dollar recedes.
Jackson Hole, PMI data dump still loom ahead.

GBP/USD briefly tested chart paper on the high side of 1.3100 on Wednesday as Cable continues to push deeper into bull country. The pair is marching into fresh 13-month highs, setting a peak intraday bid of 1.3112, and the Sterling is threatening to cross into its highest prices against the Greenback since April of 2022.

The US Bureau of Labor Statistics announced a steep cut of over 800K jobs to March’s Nonfarm Payrolls (NFP) jobs print, sharply revising previous job growth figures to the low side. The tilt in hiring numbers prompted markets to add to bets of a double cut from the Federal Reserve (Fed) in September. Rate cut bets pinned even higher on Wednesday after the Fed’s latest Meeting Minutes revealed policymakers in the US central bank had already begun discussions about when to begin cutting interest rates as early as July.

UK Purchasing Managers Index (PMI) figures for August are expected to drift upwards slightly on Thursday, with the UK Services PMI component forecast to tick up to 52.8 from 52.5. The Manufacturing section is expected to hold steady at 52.1.

US PMI business activity survey results are also slated for release on Thursday, as well as the kickoff of the annual Jackson Hole Symposium which is set to run through the weekend. Wednesday will deliver the Federal Reserve’s (Fed) latest Meeting Minutes, but market forces will broadly be looking ahead to Thursday’s outings for reasons to move.

US S&P Global Manufacturing PMI activity expectations are forecast to hold steady at 49.6 in August, while the Services PMI component is expected to tick down a full point to 54.0 from 55.0. The kickoff of the Jackson Hole Symposium is expected to draw plenty of investor attention on Thursday, but Friday’s appearance from Fed Chairman Jerome Powell can be expected to set the overall tone of market sentiment heading into next week.

GBP/USD technical outlook

With Cable chalking in a fifth straight gain, GBP/USD is poised for a breach into multi-year highs, provided buyers can maintain pressure long enough to keep prices climbing beyond 2023’s July peak of 1.3142. Odds favor the buyers as GBP/USD has closed in the green for all but one of the last ten consecutive trading days.

GBP/USD daily chart

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