GBP/USD: bullish potential remains limited ahead of BoE - FXStreet

Valeria Bednarik, chief analyst at FXStreet, explained that the GBP/USD pair posted a fresh 2-week low (1.3138), as the British Pound reacted negatively to the mixed employment data released on Wednesday, ahead of the BOE meeting this Thursday.

Key Quotes:

"The unemployment rate remained steady at 4.9 in the three months to July,  while in the same period, the number of people at work increased by 174K, up to 31.77 million. Part-time employment rose by 126K, while wages ticked modestly lower, as total income resulted at 2.3%YoY against previous 2.5%, whist the average earnings excluding bonus resulted at 2.1% against previous 2.3%."

"The pair, however, bounced sharply in the US afternoon, amid broad dollar's weakness, presenting now a bullish stance for the short term. In the 1 hour chart, the price has accelerated above its 20 SMA that anyway remains flat around 1.3190, while technical indicators entered positive territory, maintaining their bullish slopes. In the 4 hours chart, the recovery stalled around the 200 EMA at 1.3235, while the 20 SMA maintains its bearish slope above this last, suggesting that further gains are not yet confirmed. In the same chart, technical indicators have recovered within negative territory, but remain below their mid-lines, also indicating that the upward potential remains limited."