The GBP / USD pair fell towards the 2/8 murray zone just above 1.3798. The pair found support above this zone. The US dollar is strengthening a day before the NFP releases. The markets are likely to be discounting the data, and there could be a strong bullish momentum in the GBP / USD pair on Friday in the American session.
In the United States, private payrolls increased by 692,000 in line with the expectations of ADP employment report. Optimistic expectations for the official nonfarm payrolls pushed down the GBP / USD pair. Now during the European pre-market, the pair is rebounding with the purpose of consolidating above the SMA of 21.
The SMA of 21 in 1-hour charts will be the key point we have to watch. With a consolidation above 1.3827, it will be a good opportunity to buy the GBP / USD pair. On the contrary, a bounce off 2/8 of a murray will also give us a chance, but we must do so with caution.
The 1-hour chart shows the bearish bias still intact, although the eagle indicator is starting to show signs of a likely bullish move in the next few hours. Only a price above 1.3830 will confirm this outlook.
A decline below 1.3793 (2/8 murray) should drive the British pound to the 1/8 murray zone located at 1.3732. If it breaks down and consolidates below the strong support at 1.3793, a steeper decline appears probable.
The immediate resistance is located at 1.3855 (3/8) and the strong resistance at 1.3916, accompanied by the 200 EMA at 1.3892. These levels must be taken into account for a probable upward movement.
Our recommendation is to buy above the 21 SMA or at a technical bounce at 2/8 murray with targets at the 200 EMA (1.3892). If the pair is trading below 1.3780, we should avoid buying.
Support and Resistance Levels for July 01 - 02, 2021
Resistance (3) 1.3938
Resistance (2) 1.3887
Resistance (1) 1.3863
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Support (1) 1.3789
Support (2) 1.3756
Support (3) 1.3714
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Trading tip for GBP/USD for July 01 - 02, 2021
Buy in case of a bounce off 2/8 of murray 1.3793 with take profit at 1.3892 (EMA 200) and 1.3916 (4/8), stop loss below 1.3760.
Buy above 1.3837 (SMA 21) with take profit at 1.3892 and 1.3916 (4/8), stop loss below 1.3800.
