GBP/USD spikes to 1.31 handle and retreats, NFP in focus

The GBP/USD pair caught some aggressive bids and quickly recovered around 50-pips from fresh one-month lows, near mid-1.3000s, touched in the past hour. 

The GBP bulls gained some respite after the UK Prime Minister Theresa May comments suggested that she is not stepping down and has full backing of her cabinet to provide calm leadership to the country. 

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The recovery, however, lacked any strong follow through traction as investors refrained from placing aggressive bets in anticipation of any positive surprise from the keenly watched US monthly jobs data.

The pair has now retreated back to 1.3080 as investors brace for the highly anticipated NFP report, due for release in a short while from now.

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Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes: "From the current level, the pair has a strong support in the 1.3030 region, with a break below exposing the 1.2990/1.3000 region. Below this last, the downward risk will likely increase, with the pair then poised to extend its decline during the upcoming sessions towards 1.2830. A recovery above 1.3100, on the other hand, could see the pair correct up to the 1.3150/60 region, while beyond this last, an approach to 1.3200 in on the cards."