The whippy nature of recent GBP/USD price action indicates traders will struggle for direction until Friday's U.S. non-farm payrolls data and Tuesday's U.S. election.

One-week GBP/USD volatility has risen to 10.16, well above the 10-day moving average at 6.4, indicating growing unease in the market before looming event risk.

The rise in volatility has dialed back liquidity to some degree and the whippy nature of sterling hints that traders have pared positions considerably and could be covering flows on a one-off basis.

Recent dollar gains fueled by the Trump trade -- based on market expectations of higher rates due to tariffs and fiscal policies -- may have become over extended.

Meanwhile, GBP/USD could be hamstrung by the BoE, which like the Fed is also on a lower policy path, potentially capping gains ahead of cable's 2024 high at 1.3434.

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