GBP/USD Trapped in Narrow Range as American Data Weighs on Sterling

The Pound Sterling (GBP) has been trading within a narrow range over the past two sessions, unable to break above the moving-average band that has capped every rally since mid-July. Despite reclaiming this band on Monday, price action remains stagnant, with no significant changes in the past 48 hours.

The daily Stochastic Relative Strength Index (Stoch RSI) sits near 25, indicating a bullish bias while the EMA band holds. However, momentum is not confirming this strength, and any gains above 1.3500 should be treated as a Dollar event rather than a Sterling one.

The recent American data releases have had a significant impact on the GBP/USD exchange rate. Private payrolls printed 44K against a 70K consensus, less than half of June's 98K, and the Institute for Supply Management (ISM) services employment index dropped to 47.4 from 51.2.

The Dollar is doing all the work in this trade, with the American releases handing the Greenback two reasons to fall and one reason not to. Rate pricing tells a similar story, with odds on a September increase trimmed toward the high fifties from the high sixties over the past two sessions.