GBP/USD Rides Soft US NFP Rebound, UK Politics Cap Upside

GBP/USD edges higher to 1.3360 in early European trade, lifted broadly by a cooler US jobs print that trimmed Fed rate hike bets.

Markets dialed back September tightening odds to 52% from 66% pre-data per CME FedWatch, dragging the US dollar lower and offering sterling near-term support.

UK political shifts add mixed pressure: following Keir Starmer’s resignation, Andy Burnham’s pledge to uphold strict fiscal rules props up the pound for now. Natixis flags persistent caution, as investors await upcoming budgets for any signs of looser public spending limits that would weigh on sterling.

Daily Technical Setup

The pair holds above the mid Bollinger Band, retaining mild bullish bias yet capped firmly by the 100-day SMA. The 14-period RSI reads 54, showing gentle upward momentum without overbought stretched conditions.

- Resistance: Immediate hurdle at the 100-day SMA near 1.3410; a daily close above unlocks a test of upper Bollinger Band at 1.3468

- Support: Mid Bollinger Band at 1.3300; deeper pullbacks may attract dip-buyers toward the lower band at 1.3132 within the established trading range

Upside rallies remain constrained by lingering UK fiscal uncertainty, limiting sustained gains even with dollar softness.