GBP/USD: Bounces off uptrend support on excellent job figures

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The UK published excellent job figures once again, which continue a previous trend of improvements.

GBP/USD rose back above 1.60, but more importantly, escaped the long term uptrend support that it was getting to close to lose. Is this the end of the correction? Can we expect new highs for cable?

The Claimant Count Change showed a huge drop of 41.7K unemployed in September, far better than 24.3K expected. In addition, the data for August was revised to a similar drop of 41.6K, better than the initial report of 32.6K. The unemployment rate for August remained unchanged at 7.7%.

GBP/USD has been trading above an uptrend support line since early July. After the correction seen recently, the pair got very close to the line earlier.

Here is how it looks on the chart:

GBP USD jumping October 16 2013 after job figures technical analysis for foreign exchange traders

1.60 is a very round number, but hasn’t always worked as strong support or resistance. 1.5910 had a critical role in preventing a new downfall, and not for the first time. Below, we can find 1.5750.

On the topside, 1.6160 was the first peak after the breaking 1.60 in September and serves as the first resistance line now. The next highs are 1.6260, which was the peak in this round. 1.6380 is a the top line for 2013.

GBP/USD made a much needed correction after climbing from the bottom of 1.48. It reacted strongly to every slightly disappointing figure. With new backing from economic data, it seems that the consolidation is now over.

For more lines and analysis, see the GBPUSD forecast.

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About Author

Yohay Elam – Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I’ve accumulated. After taking a short course about forex. Like many forex traders, I’ve earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I’ve worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.

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