UK stocks retreated even as the interest of UK firms from foreign entities continued. According to the Wall Street Journal, NortonLifeLock is in advanced talks to acquire Avast in a deal that will value the antivirus company at more than $8 billion. Its stock rose by more than 14% and was the best performer in the FTSE 100 index. The deal comes two weeks after Morrison’s Supermarket is accepted to be acquired by a consortium led by Fortress. Recently, Asda, a leading supermarket was acquired by TDR Capital. This activity is mostly because UK firms have become relatively undervalued because of Brexit. The FTSE 100 index dropped by 0.15% to 7,080 pounds.

US futures declined as investors continued reacting to Jerome Powell’s testimony. Futures tied to the Dow Jones and S&P 500 index declined by less than 0.23%. On the other hand, the tech-heavy Nasdaq 100 index rose by 0.35%, signaling that investors believe that the Fed will not tighten soon. In his testimony yesterday, Jerome Powell said that the Fed will maintain its monetary policy even as inflation jumped. This is even after he was increasingly pressed by right-leaning politicians on complacency. US indices will react to earnings by top companies like Progressive, Morgan Stanley, and US Bancorp.

The British pound rose slightly even after the relatively disappointing May jobs numbers. According to the Office of National Statistics (ONS), the country’s unemployment rate rose from 4.7% in April to 4.7% in May. This increase was slightly better than the median estimate of 4.7%. It was also the first miss in several months. Additional data showed that the UK claimant count change declined by more than 114.8k in June, a bigger number than the previous 92k. This increase was mostly because of the ongoing Delta variant of coronavirus. Other important numbers published today were the Australian jobs data and the Chinese GDP numbers.

GBP/USD

The GBP/USD pair rose to an intraday high of 1.3885 even after the disappointing UK jobs numbers. On the four-hour chart, the pair managed to move above the ascending trendline shown in orange. The Relative Strength Index (RSI) also saw a bullish divergence pattern. The pair also seems like it has formed an ascending triangle pattern. Therefore, there is a possibility that it will have a bullish breakout later today.

EURUSD

The EURUSD pair continued its recovery after falling sharply yesterday. The pair rose to a high of 1.1850, slightly below the descending channel’s upper side. It also moved slightly above the two lines of the Envelopes pattern while the DeMarker has moved from the oversold level. Therefore, the pair will likely decline as bears target the lower side of the channel at 1.1773. However, a move above 1.1865 will invalidate this trend.

AUDNZD

The AUDNZD pair declined sharply on Wednesday after the hawkish RBNZ interest rate decision. It fell from a high of 1.0738 to a low of 1.0616. Today, the pair attempted to bounce back, helped by the overall strong Australian jobs numbers and formed what looks like a bearish flag pattern. It also moved below the 25-day moving average. Therefore, the pair will likely keep falling as bears target the next key support at 1.0600.