GBP/USD Price Analysis: Sterling Gains Despite Downbeat Data…

• Average weekly earnings in the UK met forecasts at 4.9%.

• Market participants maintained the chances of a November BoE rate cut at 80%. 

• The greenback remained firm due to a shift in tone among Fed officials.

The GBP/USD price analysis shows little change, as the pound remains within its tight range. UK employment figures failed to change the outlook for Bank of England rate cuts. Market participants are focused on upcoming inflation data. Meanwhile, the dollar remained steady as policymakers assumed a cautious tone on rate cuts.

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Data on Tuesday revealed that average weekly earnings in the UK met forecasts at 4.9%. Meanwhile, monthly unemployment claims surged to 27,900, above estimates of 20,200. However, the figures had little impact on the pound. Moreover, market participants maintained the chances of a November BoE rate cut at 80%. 

Meanwhile, traders are eagerly awaiting the inflation report due on Wednesday. UK price pressures have eased significantly. In September, economists believe inflation will ease further, coming in at 1.9%. A lower figure would increase the likelihood of a November Bank of England rate cut. Meanwhile, an upside surprise would boost the pound by lowering rate-cut expectations. 

Elsewhere, the greenback remained firm due to a shift in tone among Fed officials. On Monday, two policymakers noted that the US central bank should proceed cautiously. These sentiments come after recent data showed a robust economy. At the same time, inflation was higher than expected in September. As a result, market participants are pricing a slight chance of a Fed pause in November. This week, the US retail sales will further shape the outlook for rate cuts.

GBP/USD key events today

Market participants will keep digesting the employment figures as there won’t be any more key events.

GBP/USD technical price analysis: Bulls test the 30-SMA resistance

On the technical side, the GBP/USD price is challenging the 30-SMA resistance. The price has remained in a tight consolidation, slightly below the SMA, indicating a period of indecision. However, the RSI supports a looming bullish reversal as it has made a bullish divergence. Bearish momentum faded when the price reached the 1.3051 support level. 

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If bulls take charge with a break above the 30-SMA, the price will target the 1.3201 resistance level. Otherwise, the downtrend will likely continue with a new low below 1.3051.

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