GBP/USD – Can Cable Hold 1.2820 Ahead of Employment Report?
Aayush Jindal
Key Highlights
The British Pound was under renewed selling pressure and traded below 1.2920-00 against the US Dollar.
There was a break below a major bullish trend line with support at 1.2945 on the 4-hours chart of GBP/USD.
Today in the UK, the Claimant Count Change will be released, which is forecasted to post 10K.
Recently in the US, the NFIB Business Optimism Index for June 2017 released by the NFIB Research Foundation posted a decline from 104.5 to 103.6.
GBPUSD Technical Analysis
The British Pound seems to be struggling to remain above 1.2900 against the US Dollar. The GBP/USD is currently trading lower and attempting a break below 1.2820-00.Recently, cable succeeded in breaking a major bullish trend line with support at 1.2945 on the 4-hours chart. It traded below 1.2925 and currently holding the 1.2840-20 support area.The 1.2820 support holds a lot of importance since it coincides with the 100 and 200 simple moving average (H4). Therefore, a close below 1.2800 might ignite heavy declines in GBP/USD in the near term.On the upside, there is a bearish trend line at 1.2940, positioned well to act as a resistance.
NFIB Business Optimism Index
Today in the US, the NFIB Business Optimism Index for June 2017 was released by the NFIB Research Foundation. The market was positioned for a minor decline from the last reading of 104.5 to 104.4.The actual result was slightly lower, as there was a decline to 103.6. However, there was no major impact on the USD.
UK’s Recent Events
Recently, there were a few key speeches by BOE policymakers, including Dr Ben Broadbent and Andrew G Haldane. The market was expecting comments by the members on monetary policy, but there were none.The only important point to note from Broadbent’s speech was the mention about price spikes after the Brexit. In another important event, British Prime Minister Theresa May’s speech got the attention of the market. She stated:
The government needs to ensure that any new measures are pro-growth so that companies can continue to expand and create well paid opportunities for people in the UK.
Overall, the market is waiting for the unemployment report in the UK for June 2017, which may impact GBP/USD in the near term.
Economic Releases to Watch Today
UK Claimant Count Change June 2017 – Forecast 10.0K, versus 7.3K previous.
UK ILO Unemployment Rate May 2017 (3M) – Forecast 4.6%, versus 4.6% previous.
UK Average Earnings Including Bonus May 2017 (3Mo/Year) – Forecast +1.8%, versus +2.1% previous.
UK Average Earnings Excluding Bonus May 2017 (3Mo/Year) – Forecast +1.9%, versus +1.7% previous.
BoC Interest Rate Decision – Forecast 0.5%, versus 0.5% previous.
Recently, cable succeeded in breaking a major bullish trend line with support at 1.2945 on the 4-hours chart. It traded below 1.2925 and currently holding the 1.2840-20 support area.The 1.2820 support holds a lot of importance since it coincides with the 100 and 200 simple moving average (H4). Therefore, a close below 1.2800 might ignite heavy declines in GBP/USD in the near term.On the upside, there is a bearish trend line at 1.2940, positioned well to act as a resistance.