GBP/USD Price Analysis: Gains Reversed Amid Poor UK Jobs

• The GBP/USD price analysis shows the pound giving up its gains from the previous session.

• The greenback recovered as market participants watched trade talks between China and the US.

• Traders are awaiting the US CPI report, which will provide clues about the outlook for Fed rate cuts. 

The GBP/USD price analysis shows the pound giving up its gains from the previous session amid dollar strength. The greenback recovered as market participants watched trade talks between China and the US in London. Meanwhile, traders are also preparing for the US consumer inflation report and the UK’s spending plans. Downbeat UK claimant count data also ignited a sell-off. 

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After a call between the US and Chinese presidents, the two countries agreed to meet and discuss trade matters in London. The talks started after Trump accused China of not being true to their recent trade deal. 

Recently, the two countries agreed to slash tariffs for the next 90 days. Moreover, this deal paused a raging trade war that had dimmed the outlook for the global economy. Therefore, any conflicts on trade revive tensions and fears for both economies. Meanwhile, talks boost investor confidence. However, it remains unclear whether the two countries will reach an agreement. 

Meanwhile, traders are awaiting the US CPI report, which will provide clues about the outlook for Fed rate cuts. At the same time, a UK spending plan might shape the outlook for the economy and monetary policy.

GBP/USD key events today 

Traders are not looking forward to any significant releases from the UK or the US. As a result, all focus will remain on trade talks.

GBP/USD technical price analysis: Bears show strength below the 30-SMA

On the technical side, the GBP/USD price has broken below the 30-SMA, indicating a bearish shift in sentiment. At the same time, the price has made a solid red candle below the SMA, confirming strength in the new move. Currently, the price trades well below the SMA, with the RSI under 50, suggesting a bearish bias. 

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The shift comes after the previous rally paused at the 1.3603 resistance level and made a bearish divergence. This weakness allowed bears to gain momentum and take charge by pushing the price below the SMA. 

Bears can now aim for the next support at the 1.3400 level. A break below this level would strengthen the bearish bias by making a lower low. On the other hand, if bears fail to achieve this, the price will bounce higher.

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