How to trade the UK jobs report with GBP/USD

Buying GBP/USD Scenario

• Tradable Positive Trigger: +1.69 deviation (2.74%) [BUY Pair]
• Key Resistance Level:  $1.3700

If it comes out at higher than expected with a relative deviation of +1.69 or higher (2.74% or higher in actual terms), the pair may go up reaching a range of 40 pips in the first 15 minutes and 77 pips in the following 4 hours. 

$1.3615 was the high point in early May and also a level of resistance early in the year. $1.3700 is a round number and also a swing low that was seen on March 1st. Further up, $1.3770 was a swing low in mid-March.

Selling GBP/USD Scenario

• Tradable Negative Trigger: -1.72 deviation (2.46%) [SELL Pair]
• Fundamental Support Level: $1.3455

If it comes out lower than expected at a relative deviation of -1.72 or less (2.46% or lower in actual terms), the GBP/USD may go down reaching a range of 50 pips in the first 15 minutes and 85 pips in the following 4 hours.

The round $1.3500 level was a cushion on May 11th. It is followed by $1.3455 which was the low point in early May and also in mid-January. If that crucial line is broken, the next support level is only $1.3300 which dates back to 2017. 

GBP/USD Levels on the Chart

More data

Did the Pound plunge come to an end? Sterling fell sharply on a long series of weak economic data and the consequent postponement of a rate hike by the BOE. One of the downers was the disappointing jobs report published in mid-April. Will this one be better? 

Preview: UK wage growth Preview: Accelerating wages are set to support Sterling

In the last five releases, the GBP/USD moved, on average, 33 pips in the 15 minutes after the data release and 60 pips in the following 4 hours.

The previous release had a negative surprise of -2.5 regarding relative deviation and the GBP/USD reached a 37 pip range in the first 15 minutes and a range of 61 pips 4 hours after that.

Follow the publication of the figure on the economic calendar. Watch out for the data from the Market Impact tool, projecting the potential price changes according to the deviation. Here is the Market Impact Studies Users Guide.