GBPUSD| Bullish reaction after the NFP

The pound started the week with a slight bullish tone against the US dollar. This increase was favored by a slightly weaker dollar, accompanied by a moderate risk appetite in the market. This scenario allowed the pair to extend its recovery from the lows recorded after the Nonfarm Payrolls (NFP) report, bringing it back towards the 1.2600 level.

Positive sentiment in the market has put pressure on the US dollar; however, it is likely that downward attempts will remain limited. Investors are preparing to maintain a cautious stance in anticipation of the release of the US Consumer Price Index (CPI) data scheduled for Wednesday.

In the context of the analysis, it should be noted that US Nonfarm Payrolls unexpectedly showed strength last Friday, confirming the solid momentum of the US economy and further questioning the possibility of a Federal Reserve rate cut in June. In this context, another positive surprise in economic data on Wednesday could give a fresh boost to the US dollar.

From a technical perspective, the GBP/USD pair is trading lower compared to the highs reached in early March. Key resistance is identified at 1.2682, a breakout of which could alleviate the downward pressure and push the exchange rate towards 1.2752, representing the 61.8% Fibonacci extension level of the March decline. Expected support levels are at 1.2572 and 1.2532.

Comment:

Good reaction of the price at the supply zone, target hit