GBP/USD: Bulls eyeing a break above 1.2950 amid risk reset

The pound is seen extending the bounce from 1.29 handle against its American counterpart, now awaiting fresh impetus to lift GBP/USD back above 1.2950 barrier.

A major turnaround in risk condition amid a recovery staged by oil prices and European equities, boosts investors’ appetite for risk currencies such as the GBP.

Moreover, cable also receives impetus from the latest Brexit headlines, after the European Commission (EC) president Juncker noted that EU is willing to negotiate with the UK in full transparency.  

Focus now shifts to the USD-side of the equation, with the greenback picking-up some strength against most of its main peers on profit-taking, as we head closer towards the US NFP data release.

Analysts at Danske note: ““We estimate nonfarm payrolls rose 170,000 in April, a bit below consensus of 190,000 but in line with the employment growth in the ADP jobs report for April.” 

GBP/USD Levels to consider            

A break above 1.2955 (May 1 high) could lift the pair above 1.2970 (7-month tops), beyond which a test of 1.3000 (psychological mark) is imminent. Conversely, a break below 1.2861 (May 3 & 2 lows), leading to a subsequent break below 1.2834/29 (Apr 27 & May 4 low) is likely to drag the pair towards testing its next support near 1.2800 (key support).