GBP/USD Outlook: Pound was slightly higher after mixed UK jobs data

Slobodan Drvenica Windsor Brokers

GBP/USD

Cable edges higher after release of key event today – UK jobs data, which showed mixed reading.
Average earnings fell below 3.0% in Dec (2.9%, the slowest rise since Aug 2018) vs 3.0% f/c and 3.2% rise in previous three-month period.
On the other side, jobless claims fell significantly below expectations (Dec 5.5K vs 22.6K f/c) but still below downward revised previous release (2.6K from 14.9K), while new employment figure strongly beat forecast (Dec 180K vs 145K f/c).
Unemployment rate remained unchanged at 3.8% - the lowest since early 1975.
Rise in employment despite broader economic slowdown is positive signal which may keep the BoE further on hold as the UK economy is expected to pick up in 2020.
Sterling came under pressure on renewed concerns about trading negotiations between Britain and the EU, as both sides have different view about Britain’s status in trading with the Eurozone after exiting the bloc.
Daily techs are bearishly aligned and see risk of further downside as pullback from 1.3069 recovery peak so far hit 50% retracement of 1.2871/1.3069 upleg.
Fresh bears see repeated close below 1.30 handle as minimum requirement while extension and close below 10DMA (1.2972) would confirm negative stance and expose rising 100DMA (1.2925) and 10 Feb low (1.2871).
Conversely, close above 1.30 would reduce bearish pressure and signal possible renewed attack at 55DMA (1.3064).

Res: 1.3006; 1.3024; 1.3053; 1.3064
Sup: 1.2970; 1.2947; 1.2925; 1.2894

Interested in GBP/USD technicals? Check out the key levels

1. R3 1.3094
2. R2 1.3074
3. R1 1.3038
PP 1.3018
1. S1 1.2982
2. S2 1.2962
3. S3 1.2926

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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