Scotiabank analysts Shaun Osborne and Eric Theoret note that GBP/USD is trading defensively below 1.35, extending weekly losses as weaker jobs data and narrower yield spreads erode support. They flag elevated domestic risk into Friday’s retail sales and PMI releases, with expectations for solid services growth. Technically, the break of the 50-day MA raises risk of a move below the 200-day MA and toward January’s mid-1.33 lows.
Data risks and technical breaks weigh
“Fundamental support has been eroded on the back of weaker jobs data, narrowing yield spreads as markets have repriced easing from the BoE.”
“Near-term domestic risk remains elevated into Friday’s retail sales and preliminary PMI’s, with market participants eyeing healthy levels of growth in services and modest expansion in manufacturing.”
“GBP appears somewhat vulnerable to disappointment, given that expectations are relatively elevated.”
“For GBPUSD, technicals are bearish following the break of the 50 day MA (1.3529), with risk of a push below the 200 day MA (1.3445) and a test of the January lows in the mid-1.33s.”
(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)
Source: https://www.fxstreet.com/news/gbp-usd-break-of-50-day-ma-leaves-pound-vulnerable-scotiabank-202602200608
