Later today, the UK employment report will be released. This is likely to shake things up for the GBP if we see some deviation from expectations.

We have seen some mixed numbers from the UK recently, such as the impressive inflation report yesterday or the horrible construction, industrial and manufacturing numbers we saw last Friday. If we only go a week further back in time, the numbers are even more mixed, so the market is unsure which way to go now.

There have been some positive fundamental events for the GBP recently, theoretically, but most of them have already been priced in on this 8-9 cent surge in GBP/USD over the last couple of months.

Add to this the fact that the data has been all over the place, then the uncertainty becomes too much. Hence, the hesitation to break above 1.30 or move substantially lower, to 1.25 for example.

So, if today´s employment numbers follow in the footsteps of the recent weeks, (where we have seen some big surprises), then I think that the market will make its mind up, at least in the short term. It´s possible we will finally break above 1.30 if the numbers are good or dive below 1.28 if the numbers miss expectations.

The problem for forex traders will be catching the price because the algos (algorithms) will go crazy in the split second after the data is released, probably before we´re even able to actually see it.   

I prefer a miss because the dive will be potentially bigger than the jump if the data is good. However, it depends on how fast I will be able to get into the market.