British Pound finds footing at 1.3420 with markets awaiting US Job Openings data

• GBP/USD ticks up to session highs a¡bove 1.3440 after bouncing from 1.3420.
• A mild risk appetite on US-Iran peace hopes and caution ahead of key US labour data releases are weighing on the US Dollar.
• Analysts at Deutsche Bank foresee a moderate increase in US employment in July.

The British Pound (GBP) edges higher against the US Dollar (USD) on Tuesday, reaching session highs above 1.3440 after finding support at the 1.3420 area earlier on the day. A mild risk appetite amid market hopes of a negotiated breakthrough in Iran and investors’ cautiousness ahead of key US labour market releases are keeping US Dollar bulls subdued on Tuesday.

A tense calm holds for the second consecutive day in Iran, with news from the conflict showing contradictory versions. US President Donald Trump affirmed that this is Tehran’s last chance to sign a good deal with the United States, but Iranian authorities have denied any talks with US negotiators and reiterated their threats to strike the US Navy if the blockade on Iran continues.

US employment figures in the spotlight

In the macroeconomic form, the focus today is on the US JOLTS Job Openings data from June, due later on Tuesday, that will set the tone for Wednesday's ADP Employment Change report and the all-important Nonfarm Payrolls release, due on Friday. These figures will be carefully analysed for a better assessment of the Federal Reserve's near-term monetary policy plans.

Economists at Deutsche Bank note that markets await incoming data to reinforce the view that the "US labour market remains resilient.” The analysts, however, anticipate a mixed report, with an employment growth of +65k and the Unemployment Rate steady at 4.2% "although risks are skewed towards a rounding up to 4.3% if labour force participation rebounds after last month’s sharp decline.”

Regarding the GBP/USD's near-term outlook, Strategists at UOB Group observe the Pound's strength but wonder whether GBP can break and hold above a significant resistance at 1.3555. The UOB Group notes that GBP "must hold above the ‘strong support’ level, currently at 1.3385,” to sustain the momentum, but acknowledge that “after the subsequent pullback, the odds of GBP rising to 1.3555 have diminished.”