Cable Slides Down amid US Jobless Claims News

The Great Britain Pound (GBP) inched lower against the US Dollar (USD) on Friday, decreasing the price of GBPUSD to less than 1.3150 following some key economic events. The technical bias remains bullish because of a higher low in the recent upside rally.

GBP/USD Technical Analysis

As of this writing, the pair is being traded near 1.3120. A hurdle may be noted around 1.3655 (a major horizontal resistance zone) ahead of 1.3900(a psychological level) and then 1.3943 (another major resistance area).

On the downside, a support can be noted around 1.3100 (a psychological number) ahead of 1.2634 (the low of the last major downside move) and then 1.2500 (the confluence of horizontal support as well as psychological number) as demonstrated in the given above chart. The technical bias shall remain bullish as long as the 1.2700 support area is intact.

US Job Data

The number of Americans filing for unemployment benefits increased less than expected last week, suggesting the labor market continued to tighten after recent hurricane-related disruptions.

Initial claims for state unemployment benefits increased 10,000 to a seasonally adjusted 233,000 for the week ended Oct. 21, the Labor Department said. Claims fell to 223,000 in the prior week, which was the lowest level since March 1973.

Economists had forecast claims rising to 235,000 in the latest week. They have declined from the almost three-year high of 298,000 hit at the start of September in the aftermath of Hurricanes Harvey and Irma, which ravaged parts of Texas and Florida.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair around current levels may be a good strategy in short to medium term.

 

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Usman Ahmed

Usman Ahmed is an individual forex trader and market analyst. He holds a Masters of Business Administration (MBA) degree. His work includes fundamental and technical reports on various currency pairs, commodity futures and stock markets. His technical analysis features price action strategies.

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