GBP/USD holding on to UK labor market report led gains

The GBP/USD pair is seen extending the better-than-expected UK jobs report led strengthening move and has now returned back above 1.4200 level.

Following its recent slide to the lowest level since mid-April, the pair traded cautiously higher earlier during the Asian session. The pair extended its rebound further after the release of UK jobs report, particularly on the back of strong Average Earnings growth that is considered to be a gauge of future inflationary pressure.

Later during the day, the Fed will announce its monetary policy decision, which would be accompanied with central bank's economic, inflation and interest-rate projection over the next 2 years and would be followed by a press conference by the Fed Chair Janet Yellen. Investors will also await for BoE's monetary policy decision, during European session on Thursday.

Meanwhile, the cable might continue to be suppressed on worries surrounding 'Brexit' and its economic implication, and might continue to react with extreme volatility to various poll results.

Technical levels to watch

On a sustained strength above 1.4200 handle the pair could be headed towards testing its next major resistance near 1.4250-60 region. Although momentum above 1.4250 could get extended but is likely to be capped around an important support break-point, now turned strong resistance around 100-day SMA, near 1.4350 region. 

On the downside, weakness below 1.4170-75 immediate support might continue finding support near 1.4100-1.4090 area, below which the pair seems all set to extend its near-term downward trajectory, initially towards 1.4000 psychological mark support before heading towards a major support near 1.3960-50 area.