GBP/USD Forecast: Eyes on UK employment data

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3664

Health Secretary Matt Hancock said that there are early signs the latest measures “are working.”
The UK unemployment rate is expected to have risen to 5.1% in the three months to Nov.
GBP/USD is neutral-to-bearish in the near-term, decline to accelerate once below 1.3620.

The GBP/USD pair is posting modest daily losses this Tuesday, trading by the end of the American session around 1.3660. An early advance was offset by the prevalent risk-off mood throughout the second half of the day, although the downside remained limited for the pound. The UK didn’t publish relevant macroeconomic data, although coronavirus-related news were encouraging. The country reported 22.2K new contagions on Monday, the lowest since mid-December. UK Health Secretary Matt Hancock said that there are early signs the latest measures against COVID-19 “are working.”

This Tuesday, the UK will publish an update on employment. The ILO Unemployment Rate is foreseen at 5.1% in the three months to November, up from 4.9% previously. The number of people claiming for unemployment benefits is expected to have shrunk from 64.3K to 47.5K in December.

GBP/USD short-term technical outlook

The GBP/USD pair is poised to extend its decline in the near-term. The 4-hour chart shows that it is developing below a directionless 20 SMA, although above an also flat 100 SMA. Technical indicators stand within negative levels, but without clear directional strength. A steeper decline could be expected below 1.3620, the immediate support level.

Support levels: 1.3620 1.3585 1.3530

Resistance levels: 1.3695 1.3745 1.3790

View Live Chart for the GBP/USD

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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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