GBP/USD Forecast: Brexit uncertainty overshadows UK data

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.3053

UK wages’ growth came in better than anticipated in the three months to November.
Speculative interest needing clearer clues about the future relationship between the UK and the EU.
GBP/USD technically neutral as long as it trades between 1.2960 and 1.3120.

The Sterling got a subtle impulse from UK employment data, advancing against the greenback to 1.3083. As expected, the unemployment rate remained steady at 3.8% in the three months to November, although average hourly earnings in the same period beat the market’s expectations by printing 3.2%. The number of people claiming for jobless benefits increased by 14.9K, much better than the 22.6K expected.

Meanwhile, speculative interest keeps waiting for some Brexit clarity. The UK is set to leave the Union by the end of this month, with the focus on whether if a future relationship can be established before year-end. This Wednesday, the UK will publish the CBI Industrial Trends Survey on orders for January, foreseen at -23 from the previous -28.

GBP/USD short-term technical outlook

The GBP/USD pair is trading at around the 23.6% retracement of its latest daily slump at 1.3050, and intraday charts indicate a limited bullish potential at the time being, moreover considering the price stalled below last week’s high at 1.3118. In the 4-hour chart, the pair is currently developing between directionless moving averages, while the Momentum indicator stands pat around its 100 level. The RSI, on the other hand, has resumed its decline but holds just above its mid-line. Overall, the pair is neutral as it has been hovering around the current level for over a week.

Support levels: 1.3000 1.2965 1.2930

Resistance levels: 1.3085 1.3120 1.3160

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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