GBP/USD Strengthens Amid Steady UK Labor Market and Wage Growth

Traders' Opinions

Summary:

The British Pound strengthened against major currencies on Tuesday, bolstered by resilient UK labor market data. Investors are eyeing upcoming CPI and Bank of England policy announcements, which could drive further volatility in GBP trading.

BUY GBPUSD

Close Time

CLOSED

1.36601

Entry Price

1.37500

1.35400

1.33554 -0.00153 -0.11%

120.1

Pips

Loss

1.35400

Exit Price

1.36601

Entry Price

1.37500

The Pound Sterling (GBP) gained traction against major currencies on Tuesday, reaching its highest levels against the US Dollar in over two months, as investors digested fresh labor market data from the United Kingdom. According to the Office for National Statistics (ONS), the unemployment rate remained steady at 4.7% in the three months ending July, a four-year high but in line with market expectations.

Employment growth in the UK continued to show resilience, with the economy adding 232,000 jobs in the quarter, closely matching forecasts of 220,000 and slightly below the previous quarter’s tally of 239,000. The labor market’s underlying strength was further reflected in wage growth. Average earnings excluding bonuses, a key gauge of wage inflation, rose 4.8% annually, consistent with forecasts yet slower than the 5% pace observed previously. Average earnings including bonuses—a metric closely monitored by the Bank of England (BoE)—increased 4.7%, slightly above the prior reading of 4.6%, signaling a stable but moderate acceleration in compensation pressures.

These figures provide a nuanced picture for policymakers. Steady employment conditions may offer some comfort to the BoE, which has expressed concerns over potential labor market weakness. Earlier this month, BoE Governor Andrew Bailey noted that he was “more concerned about downside job risks” than some members of the Monetary Policy Committee (MPC), who in August opted to maintain the policy rate. The resilience in the labor market could reduce the urgency for immediate monetary tightening, though inflationary pressures remain a key concern.

Financial markets are bracing for a potentially volatile week for the Pound. Investors are awaiting the release of the UK Consumer Price Index (CPI) for August on Wednesday and the BoE’s monetary policy decision on Thursday. Economists expect headline inflation to rise slightly to 3.9% from 3.8% year-on-year. Any acceleration in inflation could reinforce expectations that the BoE will hold interest rates steady at 4% in its upcoming policy review, while subdued inflation might rekindle speculation of a future rate adjustment.

Technical Analysis

On the technical front, GBP/USD confirmed bullish momentum during intraday trading, breaking past the critical resistance level at 1.3585. The pair remains supported above its 50-day exponential moving average (EMA50), indicating that short-term upward trends are intact. A key resistance zone between 1.36326 and 1.35700 has now shifted to become support, setting the stage for further gains.

However, relative strength indicators suggest caution in the short term. After entering overbought territory, some negative overlapping signals appeared, prompting minor corrective trading. Despite this, the broader bias remains bullish, with potential upside targeting 1.3750 in the near term.

TRADE RECOMMENDATION

BUY GBPUSD

ENTRY PRICE: 1.3660

STOP LOSS: 1.3540

TAKE PROFIT: 1.3750

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Warren Takunda

Traders' Opinions

Summary:

The Australian dollar strengthened on Tuesday, trading near a one-month high against the U.S. dollar, as investors braced for a widely expected Federal Reserve rate cut

BUY AUDUSD

Close Time

CLOSED

0.66700

Entry Price

0.67200

0.66300

0.66404 -0.00116 -0.17%

7.1

Pips

Profit

0.66300

0.66771

Exit Price

0.66700

Entry Price

0.67200

The Australian dollar was trading firmly near its Monday peak at 0.6670 against the U.S. dollar during the European session on Tuesday, with momentum pointing to further upside as markets priced in aggressive expectations of Federal Reserve policy easing. The move underscores a growing narrative in global FX markets: that the U.S. central bank has reached the end of its tightening cycle and is now preparing to unwind its restrictive monetary stance.

The U.S. dollar index (DXY), which tracks the greenback’s performance against six major peers, slumped to a fresh seven-week low around 97.00 at press time. Traders have been quick to trim dollar exposure ahead of Wednesday’s highly anticipated Fed policy decision. According to the CME FedWatch tool, there is now a 96% probability that the Fed will lower rates by 25 basis points to 4.00%-4.25%, with a growing minority anticipating a more aggressive 50-basis point cut.

This dovish shift has been largely driven by weakening labor market indicators in the U.S., exacerbated by the effects of tariffs imposed under President Donald Trump’s trade strategy. In recent weeks, several Fed officials, including Chair Jerome Powell, have openly flagged the risks of a slowing jobs market, signaling that employment concerns now outweigh inflation fears. Powell’s comments in particular have reinforced investor confidence that the Fed is ready to act decisively to support growth.

Market focus now turns to incoming U.S. retail sales data for August, scheduled for release at 12:30 GMT. Retail sales are forecast to have grown by a modest 0.2%, reflecting resilient but cooling consumer demand. A softer reading would add further weight to the case for deeper Fed cuts, while a stronger surprise could temporarily stall dollar weakness.

On the other side of the equation, the Australian dollar faces its own set of domestic data risks. Traders are awaiting Australia’s August employment report, due on Thursday. Economists expect the unemployment rate to hold steady at 4.2%, with a net gain of around 21,200 jobs, down slightly from the previous month’s 24,500. Given the Reserve Bank of Australia’s (RBA) cautious stance on growth and inflation, the data could provide a fresh directional cue for the currency.

Technical Analysis

From a technical perspective, AUD/USD continues to display strong bullish momentum. The pair is testing the 0.6670–0.6680 resistance zone, a level that has capped gains in recent sessions. Price action remains comfortably above the 50-day exponential moving average (EMA50), while the broader structure shows the pair respecting its ascending trendline. Additional support is drawn from the EMA 34/89 combination, which reinforces the bullish bias.

Momentum indicators are also flashing encouraging signals. Relative strength measures suggest that buyers remain firmly in control, with upside potential intact as long as the pair sustains above the trendline. A clean break above 0.6680 could open the door toward higher targets, potentially retesting 0.6720 and beyond, while failure to clear resistance may trigger short-term consolidation.

TRADE RECOMMENDATION

BUY AUDUSD

ENTRY PRICE: 0.6670

STOP LOSS: 0.6630

TAKE PROFIT: 0.6720

Risk Warnings and Disclaimers

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Warren Takunda

Traders' Opinions

Summary:

The euro advanced to a fresh multi-month high as a surprise rebound in German investor sentiment and expectations of a dovish Federal Reserve weighed on the dollar.

BUY EURUSD

Close Time

CLOSED

1.18100

Entry Price

1.19000

1.17500

1.17325 -0.00069 -0.06%

27.6

Pips

Profit

1.17500

1.18376

Exit Price

1.18100

Entry Price

1.19000

The euro strengthened further against the U.S. dollar on Tuesday, climbing to levels not seen since early July after a surprise improvement in German economic sentiment lifted confidence across European markets. The single currency briefly reached 1.1818 before easing back toward the 1.1800 area ahead of the opening of the U.S. session. The move builds on momentum seen in recent weeks, as the euro continues to recover from its late-summer weakness, which was driven by concerns over slowing eurozone growth and rising fiscal strains in France.

Data from the Zentrum für Europäische Wirtschaftsforschung (ZEW) revealed that investor expectations for Germany’s economic outlook improved in September, defying consensus forecasts for another deterioration. While the assessment of current conditions slipped for the second consecutive month, the jump in forward-looking sentiment suggests that investors are positioning for stabilization in Europe’s largest economy. The broader eurozone sentiment index also showed a brighter reading after a steep decline in August, offering some relief to policymakers in Frankfurt who have struggled to instill confidence in the bloc’s uneven recovery.

The improvement in sentiment helped offset the negative headlines surrounding France’s debt load and ongoing fiscal debates within the European Union. For investors, the data provided a reason to step back into the euro at a time when the dollar is under pressure from shifting expectations about U.S. monetary policy.

The greenback has been sliding as markets prepare for the Federal Reserve’s policy decision on Wednesday. Traders increasingly expect not just a rate cut, but also a dovish signal that could pave the way for further easing later this year. The U.S. Dollar Index, which tracks the performance of the dollar against six major peers, slipped to its lowest levels in nearly two months. Meanwhile, Wall Street equities climbed to fresh record highs as the prospect of lower borrowing costs boosted risk appetite and overshadowed concerns about slowing growth.

Attention later in the day will shift to U.S. retail sales data for August. Economists expect consumption to have cooled, largely because of weaker demand for automobiles. Should the report confirm a slowdown, it would add further pressure on the Fed to act and likely keep the dollar on the back foot. On the other hand, a stronger outcome could temporarily arrest the dollar’s slide, although the broader bias remains tilted against the greenback.

Technical Analysis

From a technical perspective, the euro-dollar pair continues to display strong upward momentum. The rally pushed the exchange rate above the important resistance level of 1.1785, which had capped gains in recent weeks. This breakout is supported by price action remaining comfortably above the 50-day Exponential Moving Average, reinforcing the bullish structure. Trading has also followed an upward-sloping bias line, adding weight to the case for further gains. However, oscillators and relative strength indicators are beginning to show early signs of negative divergence, suggesting that while the uptrend remains intact, some moderation or short-term pullback cannot be ruled out.

The 1.1700 level remains a crucial floor from recent consolidation, and as long as the pair holds above it, the bullish view remains valid. A sustained rebound from that area would confirm ongoing upside momentum and keep the market focused on further advances. The next areas of interest on the upside are 1.1846, which represents immediate resistance, followed by the psychological barrier at 1.1900, where traders may begin to take profits. Should the momentum extend beyond that threshold, the longer-term target near 1.1933 comes into play.

TRADE RECOMMENDATION

BUY EURUSD

ENTRY PRICE: 1.1810

STOP LOSS: 1.1750

TAKE PROFIT: 1.1900

Risk Warnings and Disclaimers

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Eva Chen

Central Bank

Commodity

Summary:

During Tuesday's European trading session, gold prices approached historic highs near US$3,700. Rising expectations for Federal Reserve rate cuts continue to weigh on the dollar, benefiting the non-yielding asset. Ahead of this week's pivotal Fed policy announcement, extreme overbought conditions have failed to curb gold's ascent - a typical buyer's market.

BUY XAUUSD

Close Time

CLOSED

3689.12

Entry Price

3850.00

3625.00

4328.90 +29.51 +0.69%

1608.8

Pips

Profit

3625.00

3850.09

Exit Price

3689.12

Entry Price

3850.00

Fundamentals

The dollar plunged as markets anticipated the Federal Reserve would adopt a dovish stance on Wednesday, propelling gold prices higher for a third consecutive day. The U.S. Dollar Index fell to a two-month low, supporting gold to reach a record high near US$3,700. However, gold is currently in overbought territory and may experience some near-term pullbacks.

We should expect heightened volatility around the time of the Fed statement release, particularly if market participants perceive that rate cuts will be accompanied by a hawkish statement. For instance, if the Fed fails to provide support in its guidance and projections, it could trigger a sharp decline in gold prices.

However, since Trump wants to see lower interest rates, investors should expect gold to continue its current upward trend over the next few months; it will then consolidate before rising again in 2026.

Moreover, the long-term bull market for gold appears unchanged, as demand continues to grow at an accelerated pace, particularly from central banks and ETFs.

Technical Analysis

Following a near-vertical rally, gold prices experienced a brief correction on Tuesday. Concerns among investors persist, as overbought signals suggest a potentially volatile upward trajectory. This has fueled speculation of profit-taking and selling near historical highs ahead of the Federal Reserve's announcement. Conversely, the dip-buying behavior indicates a typical buyer's market.

Immediate support levels are anticipated at the 20-day SMA of US$3,530 and the US$3,500 support level, if the prices breach the US$3,600-$3,590 range. Failure to hold these levels could lead to a further decline towards the 50-day SMA at US$3,453, coinciding with the upper boundary of the previous consolidation range.

On the upside, the bullish market dynamics may limit opportunities for late entrants, with buy-the-dip strategies expected to dominate the near-term rally. This could potentially target the US$3,700-$3,735 range, with further gains aiming for the ultimate target of US$3,850.

Trading Recommendations

Trading Direction: Buy

Entry Price: 36858

Target Price: 3850

Stop Loss: 3625

Valid Until: October 1, 2025 23:55:00

Support: 3674, 3656, 3613

Resistance: 3700, 3735, 3752

Risk Warnings and Disclaimers

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Eva Chen

Central Bank

Forex

Summary:

The UK's unemployment rate continues to decline, while wage growth remains robust, potentially leading the Bank of England to hold interest rates steady. In the 4H timeframe, the GBPUSD has broken out of a contracting triangle pattern, trading above 1.3600 and extending its bullish momentum.

BUY GBPUSD

Close Time

CLOSED

1.36455

Entry Price

1.38500

1.34500

1.33554 -0.00153 -0.11%

195.5

Pips

Loss

1.34500

1.34499

Exit Price

1.36455

Entry Price

1.38500

Fundamentals

The GBPUSD experienced a modest pullback on Tuesday after breaching the 1.3600 level, yet it maintained a positive trajectory. Robust UK wage growth may prompt the Bank of England to hold steady on interest rates during Thursday's meeting.

The UK labor market data for August, released on Tuesday, revealed a decline of 8,000 jobs month-over-month, continuing the downward trend observed since the peak in Q3 2024. The claimant count increased by 17,400, falling short of the anticipated 20,300. Median monthly earnings saw a 6.6% year-over-year increase, surpassing the 6.0% recorded in July, indicating persistent wage pressures.

The unemployment rate remained stable at 4.7% for the three months ending in July, aligning with expectations. Average earnings excluding bonuses edged down from 5.0% to 4.8%, while average earnings including bonuses saw a slight uptick from 4.6% to 4.7%. Overall, the data suggests ongoing job losses, but sustained wage growth warrants a cautious approach to policy by the Bank of England.

Job Market Resilience Strengthens, with Wage Pressure Supporting the Pound's Continued Uptrend_1

Technical Analysis

Following a breach of 1.3600, the GBPUSD maintains its upward trajectory, though bulls must secure a daily close above 1.3600 to facilitate further gains. The subsequent significant resistance level is the July 4 high of 1.3682, followed by 1.3700. A break above the latter would target the July 1 high of 1.3788.

Conversely, if GBPUSD struggles at the 1.3600 level, a test of 1.3550 could ensue. Further weakness might see a challenge of the 20-day SMA at 1.3496.

From a broader trend perspective, the uptrend initiated from 1.3051 (2022 low) remains intact. The next intermediate target is the 61.8% retracement of 1.0351, from 1.2099 to 1.3433, with a final target at 1.4004. As long as the 55-day SMA (currently at 1.3151) holds, the outlook remains bullish, even amid significant pullbacks.

Trading Recommendations

Trading Direction: Buy

Entry Price: 1.3597

Target Price: 1.3850

Stop Loss: 1.3450

Valid Until: October 1, 2025 23:55:00

Support: 1.3590, 1.3523, 1.3483

Resistance: 1.3650, 1.3681, 1.3751

Risk Warnings and Disclaimers

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Alan

Forex

Summary:

The latest UK employment data shows some softness in the labor market, but recent strong economic figures continue to support the British pound.

BUY GBPJPY

Close Time

CLOSED

200.381

Entry Price

204.900

198.600

207.418 -0.905 -0.43%

2.0

Pips

Profit

198.600

200.401

Exit Price

200.381

Entry Price

204.900

Fundamentals

Released today, the UK labor market data indicates a slowdown in wage growth, a month-on-month decline in the number of people in work, and a rise in the unemployment rate to around 4.7%, with payroll numbers for the month also decreasing, signaling a cooling in employment momentum. Seemingly, the market could interpret such signs of labor market weakness as a reason for the Bank of England to adopt a more dovish policy path, which would put downward pressure on the British pound. However, deeper data also reveal that the UK's GDP still recorded moderate growth in Q2 (positive on a quarterly basis). Additionally, although wage levels have decreased, they remain above pre-pandemic trends. This reveals the Bank of England is not about to turn decisively dovish just yet, and there is still potential for its policy stance to "hold relatively high interest rates to combat inflation." In other words, while the employment weakness provides a short-term reason for a pullback, it does not necessarily invalidate the pound's long-term valuation. On the contrary, such data fluctuations often create better entry opportunities for traders willing to buy the pound with a preference for higher interest rate differentials and risk appetite.

Technical Analysis

Holding Firm Above 200.00 Is Just the Beginning_1

The daily chart shows that the closing price of GBP/JPY last Friday confirmed a firm breakout and hold above the 200.00 level. These key psychological and technical barriers are effectively breached, further opening up the upside potential for GBP/JPY.

At present, the short-term resistance for GBP/JPY lies in the 202.00-203.00 range, with stronger resistance seen between 205.00 and 208.00. The first key support zone to watch is around 199.00–199.60. Should the exchange rate break above 202.00 in the short term and hold above that level, it would technically confirm a breakout, likely triggering additional follow-up buying interest. Conversely, if the pair retraces to the 199.00–199.60 zone and holds steady there, it would present a lower-risk opportunity to buy the dips.

Trading Recommendations

Trading direction: Buy

Entry price: 200.30

Target price: 204.90

Stop loss: 198.60

Valid Until: September 30, 2025, 23:00:00

Support: 200.00/199.00

Resistance: 202.00/203.00

Risk Warnings and Disclaimers

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Tank

Forex

Technical Analysis

Economic

Summary:

On September 15th, 2025, the Finance Sector Union of Australia announced it had filed a complaint with the Fair Work Commission, urging urgent intervention regarding ANZ Group's recent plan to lay off 3,500 employees. However, the incident has had limited impact on the Australian dollar, as market attention shifts to the employment report due Thursday (employment is expected to rise by 21,000, while the unemployment rate is projected to increase by 4.2%).

SELL AUDUSD

Close Time

CLOSED

0.66600

Entry Price

0.63000

0.67500

0.66404 -0.00116 -0.17%

39.4

Pips

Profit

0.63000

0.66206

Exit Price

0.66600

Entry Price

0.67500

Fundamentals

On September 15th, 2025, the Finance Sector Union of Australia announced it had filed a complaint with the Fair Work Commission, urging urgent intervention regarding ANZ Group's recent plan to lay off 3,500 employees. The union criticized the bank for severely inadequate consultation with affected staff, as well as failing to meet its legal obligation of proper communication. In a statement, the union accused ANZ, saying that "thousands of families are left in the dark while executives protect their bonuses." The union emphasized that the complaint was filed to secure fair treatment and job security for workers. The dispute stems from ANZ's major restructuring plan announced last week, in which the bank stated that the layoffs aimed to streamline operations and focus on core businesses. However, the bank has not yet responded directly to the union's allegations. On the same day, ANZ also agreed to pay a AU$240 million (approximately US$159.9 million) fine to settle multiple charges brought by corporate regulators, including "unreasonable" conduct in government bond trading and systemic failures such as continuing to charge deceased customers. This penalty marks the largest ever imposed on a single entity in Australia. ANZ is currently the smallest by market capitalization among Australia's "Big Four" banks. However, the layoffs had a limited impact on the Australian dollar, as market focus shifted to the employment report due Thursday (employment is expected to rise by 21,000, while the unemployment rate is projected to increase by 4.2%).

Currently, markets widely expect the Federal Reserve to cut interest rates 2 to 3 times in 2025, totaling 50-75 basis points. However, if the new leadership lineup is fully confirmed, this expectation could be revised upward. Interest rate futures markets have already begun reflecting this shift, with the probability of three rate cuts this year rising from 50% to 70%, while the likelihood of four cuts (100 basis points) has increased from 20% to 45%. For the U.S. dollar, an unexpectedly dovish policy stance would exert significant downward pressure. On one hand, if the Fed cuts rates more aggressively than the European Central Bank, the Bank of England, and other major central banks, the U.S. dollar's interest rate advantage would narrow, potentially driving capital toward higher-yielding non-dollar markets. On the other hand, the U.S. Dollar Index (DXY) may end its recent strength and enter a medium-term depreciation phase, thereby boosting commodity prices and the performance of emerging market assets. This week, key focuses include whether the nomination of Stephen Miran will be approved and whether the FOMC meeting minutes contain phrases such as monitoring "downside risks" or providing "policy support." If these signals materialize, markets may price in a steeper rate-cutting path earlier, leading to a continued weakening trend for the dollar.

Technical Analysis

Based on the 1-hour chart, the Bollinger Bands are narrowing, indicating lower volatility. Meanwhile, the moving averages are flattening with the price oscillating near the middle band. Previously, when the price reached a new high, the MACD line and the signal line formed a death cross, and the momentum histogram (bullish bars) gradually weakened, signaling a bullish divergence. With the RSI sitting at 55, the market sentiment remains neutral as traders are in a wait-and-see mode, while a potential breakout or reversal could occur at any time. Regarding the weekly chart, the price rose close to the 200-week EMA (at 0.667), a key technical resistance level, where the MACD showed a "kiss of the angels" (a bullish convergence pattern). Moreover, the RSI stays at 62, entering a strong bullish zone, while the lows are gradually rising, confirming an overall uptrend. However, historically, every time the price approaches the 200-week EMA, it has experienced a significant pullback. This time appears to be no exception, so it is recommended to sell at highs.

Long-Term Inflection Point！ AUD/USD Faces Key Resistance?_1

Long-Term Inflection Point！ AUD/USD Faces Key Resistance?_2

Trading Recommendations:

Trading direction: Sell

Entry price: 0.666

Target price: 0.63

Stop loss: 0.675

Support: 0.656/0.646/0.63

Resistance: 0.67/0.675/0.7

Risk Warnings and Disclaimers

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Long-Term Inflection Point！ AUD/USD Faces Key Resistance?​

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Long-Term Inflection Point！ AUD/USD Faces Key Resistance?