GBP/USD – Pound volatility continues in thin holiday trade

GBP/USD has started the week with considerable losses, after posting sharp gains on Friday. Currently, GBP/USD is trading at 1.3092, down 0.60% on the day. British banks are close for the May Day holiday and there are no British events. On Tuesday, the U.S. will post JOLTS Jobs Openings.

The pound ended the week on a high note, soaring 1.1 percent. Investors reacted positively to the comments from BoE Mark Carney on Thursday. The BoE maintained interest rates, but BoE Governor Mark Carney had a hawkish message for the markets. Carney said that there could be a number of rate hikes from the bank, if Brexit is resolved and growth and inflation point higher. The markets have priced in just one rate hike until 2021, so Carney’s comments mark a vote of confidence in the British economy from the BoE. There was more positive news on Friday, as services PMI improved to 50.4 in April, up from 48.9 a month earlier.

In the U.S., the week ended with mixed employment numbers. Wage growth edged up to 0.2%, shy of the estimate of 0.3%. However, nonfarm payrolls sparkled, climbing to 263 thousand, up from 196 thousand a month earlier. The reading easily beat the forecast of 181 thousand. The unemployment rate dipped to 3.6% in April, down from 3.8% a month earlier. This marked the lowest unemployment rate since 1969.

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GBP/USD Fundamentals

Monday (May 6)

  • 10:00 US FOMC Member Williams Speaks

Tuesday (May 7)

  • 10:00 US JOLTS Job Openings. Estimate 7.35M

*All release times are DST

*Key events are in bold

GBP/USD for Monday, May 6, 2019

GBP/USD May 6 at 8:30 DST

Open: 1.3175 High: 1.3175 Low: 1.3092 Close: 1.3095

GBP/USD Technical

S1 S2 S1 R1 R2 R3
1.2910 1.3000 1.3070 1.3170 1.3217 1.3300

GBP/USD posted losses in the Asian session and the downward movement continues in European trade

  • 1.3070 is under pressure in support. It could break in the North American session
  • 1.3170 is the next resistance line
  • Current range: 1.3070 to 1.3070

Further levels in both directions:

  • Below: 1.3070, 1.3000, 1.2910 and 1.2841
  • Above: 1.3170, 1.3217 and 1.3300

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.