GBP/USD Forecast: Lacking a catalyst, downside remains limited

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.2857

UK employment data came in mixed, with wages’ growth below the market’s expectations.
The United Kingdom will publish its latest inflation data this Wednesday.

The GBP/USD pair held within familiar levels this Tuesday, as UK signs were mixed. The kingdom released employment data, with the unemployment rate down to 3.8% in the three months to September, while employment fell by 58K in the same period, beating the market’s expectations. However, wages growth was weaker than expected, up by 3.6% YoY including and excluding bonus. Brexit Party leader, Nigel Farage got hit by Nicola Sturgeon after his decision not to contest seat that where won by the Tories in the 2017 general election, although he refused to make additional concessions. Mrs Sturgeon is concerned that a Tories’ victory will play against her desire for Scotland’s independence.

The United Kingdom will release October Inflation data this Wednesday. The monthly CPI is seen down by 0.1%, while the yearly reading is seen at 1.6%, slightly below the previous 1.7% reading. Core annual CPI is seen steady at 1.7%.

GBP/USD short-term technical outlook

The GBP/USD pair is ending the day little changed in the 1.2850 price zone, having traded within Monday’s range. The pair met support at the 23.6% retracement of its latest daily advance but held below its previous highs. In the 4-hour chart, the pair is confined to a tight range between directional moving averages, with a flat 100 SMA capping advances. Technical indicators in the mentioned chart offer a neutral-to-positive stance, bouncing just modestly from around their midlines.

Support levels: 1.2820 1.2785 1.2750

Resistance levels: 1.2895 1.2920 1.2950

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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