GBP/USD extends gains amid mixed US data
The GBPUSD currency pair yesterday drew a bullish candle with a rather long shadow at the top candle extending the previous two days' rise. Price formed a high of 1.25499, a low of 1.24633, closing at 1.25051, crossing the MA 50 from the lower side.
US economic data released Wednesday showed mixed data. ADP Non-Farm Employment Change showed actual data of 183k against expected 148k and previous revision of 176k. On the other hand, the ISM Services PMI showed actual data of 52.9 from the expected 54.2 and the previous revision of 54.1.
On Monday, the GBPUSD pair experienced a wide gap down like other USD pairs. However, the price then jumped consecutively in three days by drawing bullish candles. Volatility in financial markets was triggered by Trump's tariff policy which affected global markets. But concerns have eased somewhat as Canada and Mexico reached an agreement with Washington. Investors now trust Trump's tariff policy as a tool for negotiations with allies and enemies.
Today's bank holiday in New Zealand may slightly reduce the volume of financial market transactions. New Zealand banks will be closed in observance of Waitangi Day.
The main focus of the GBPUSD pair today is the Bank of England (BoE) monetary policy report and the Official Bank Rate which is expected to fall from the previous 4.75% to 4.50%.
The dollar index (DXY) experienced consecutive losses for three days by drawing a bearish candle from the original high of 109,881 plunge to 107,296 for three days. Today we are waiting for the release of US Unemployment Claims which is predicted to increase by 214k from the previous revision of 207k. Next, investors will also wait for NFP data on Friday of the first week of February, which is also expected to fall from 256k to 169k.
