Sterling Strengthens Ahead of UK Jobs Data

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Sterling Slides after BoE's Quarterly Inflation Report

There has not been much in terms of fundamental data so far this week. But on Wednesday, we will see UK jobs data, specifically earnings growth, claimant count change, and unemployment rate. This will be key for sterling, which is strengthening ahead of the key releases. Let’s take a look at the GBP/JPY and EUR/GBP.

You can also read about scenarios for the GBP/USD surrounding the jobs data here:
GBP/USD – Trading the UK Jobs Data

The GBP/JPY is pulling up after finding support at 170.75. It still looks bearish unless it can break above a trendline which it might meet around 172.25. However, we might need to limit the bullish outlook for now to 173. However, if the falling trendline holds, there is still downside risk toward the 170.75 low, then 170.35-170.40 where the 200-day SMA resides. The EUR/GBP has completed an inverted head and shoulders patter but has retreated to test its strength. Watch the 0.7940 area, where we have a cluster of support factors. A hold above this area after the jobs data should suggest bullish correction outlook in the short-term. A break below 0.7930 however signals bearish continuation.

To contact the reporter of this story, email Fan Yang at fan@forexminute.com
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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at forexminute.com.