GBP/USD has eased after experiencing resistance at 1.4000. However, the pair remains on an uptrend amid a weakening US dollar. On Tuesday, the dollar index was down by 0.14% at 90.96. This is its lowest level since early March.
The risk-on sentiment is weighing on the greenback as a safe-haven; despite this week’s decline in stocks. S&P 500 is down by 0.53% at 4,163.3. However, this is still close to the record-high set on last week’s Friday at around 4,190.
At the same time, GBP/USD is finding support in the better-than-expected UK job numbers. unemployment rate in the country dropped by 4.9% in February compared to the expected 5.1%. However, the number of employees on payrolls fell by 56,000 in March compared to the previous month. The mixed data is a sign that the UK’s labor market is still in a precarious state even as the economy gradually reopens.
GBPUSD Technical Outlook
With the weakening US dollar, GBP/USD has surged by about 2.16% since the beginning of the week. In today’s session, the pair is up by 0.11% at 1.4002. Notably, it is experiencing some resistance at 1.4000. However, the outlook remains bullish.
On a 4-hour chart, GBP/USD is trading above the 25 and 50-day exponential moving averages with an RSI of 76. In my opinion, the pair will trade sideways in the near term before moving higher towards the next targets at 1.4100 and 1.4244.
On the flip side, the bears may manage to pull the pair back to 1.3900, where it will find support as it strives to rebound. Below that level, the targets to watch out for will be1.3800 and 1.3700.