GBP/USD shrugs off bearish momentum, recovers 1.3400 region

• GBP/USD climbed on Wednesday, climbing back into the 1.3400 handle.
• Cable is poised to firm up a bullish bounce from the 200-day EMA, putting buyers on notice.
• Mid-tier UK data on the offer on Thursday, official US data remains dark amid the government shutdown.

GBP/USD found room on the high side on Wednesday, clawing its way back to the 1.3400 handle after a near-term dip into the low end that saw Cable briefly battle the 200-day Exponential Moving Average (EMA) near 1.3290. A raft of mid-tier United Kingdom (UK) economic releases are due on Thursday, but the American side of the data docket remains tepid amidst the ongoing US government shutdown that has crimped the flow of key data releases.

UK Gross Domestic Product (GDP) growth, Industrial and Manufacturing Production, and UK Trade Balance data, all for the month of August, are all due, and while each individual figure is mid-tier at best, a notable down- or up-turn across the board could see a sharp shift in intraday Cable flows.

On the US side, the ongoing government closure has restricted the flow of official datasets. On one hand, this will make it more difficult for investors to accurately gauge the health of the US economy as the shutdown drags on. On the other hand, this is great news for market participants banking on the Federal Reserve (Fed) to get locked into two more interest rate cuts through the end of the year, as Fed officials will lack most of the key data releases that would be most likely to force a hawkish pivot, namely inflation and unemployment statistics.

GBP/USD daily chart