- The change in UK Earnings is closely watched by markets and may have a significant impact on the GBP/USD.
- The Market Impact Tool shows trading opportunities in both upside and downside surprises on this event.
Buying GBP/USD Scenario
Tradable Positive Trigger: +0,52 deviation [BUY Pair]
Key Resistance Level: $1.4390
If it comes out at higher than expected with a deviation of +0,52 or higher, the pair may go down reaching a range of 39 pips in the first 15 minutes and 87 pips in the following 4 hours.
The pair is tackling the highest levels since the EU Referendum back in June 2016 at $1.4345. Higher above, 1.4390 was a pre-Referendum gap line from June 17th, 2016. The post-gap level of $1.4435 is the next level to watch before the round level of $1.4500.
Selling GBP/USD Scenario
Tradable Negative Trigger: -0,48 deviation [SELL Pair]
Key Support Level: $1.4245.
If it comes out lower than expected at a deviation of -0,48 or less, the GBP/USD may up reaching a range of 44 pips in the first 15 minutes and 85 pips in the following 4 hours
A fall from the $1.4345 battle line would send the pair back to the late-March high of $1.4245. The next level to watch is $1.4150 which was a swing high in February. Another February high at $1.4070 is the next level to watch.
GBP/USD Levels on the Chart
In the last five releases, the GBP/USD moved, on average, 32 pips in the 15 minutes after the announcement and 71 pips in the 4 hours after the release.
The previous release had a negative surprise of 4.08 concerning deviation and the GBP/USD reached a 55 pip range in the first 16 minutes after the release and achieving a range of 65 pips in the next 4 hours.
With the British economy enjoying full-employment or near full-employment conditions, the focus in the past year or so has been on wages. Higher salaries imply a faster pace of rate hikes by the Bank of England. Earnings have been on the rise of late, raising the odds of a rate hike.
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.
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