• The Greenback continues to trade bullish against most of its major peers on stronger labor market figures and sentiments of a rate hike.
• The EUR/USD trades in line with our forecast to plunge more than 85 pips.
• Investor’s focus remains on the UK labor market report today.
• Quick trade plan for GBP/USD keeping the employment report in mind.

GBP/USD – Employment Report In Focus

The British Pound is taking a slight reversal as bears have started taking profits. The GBP/USD is trading near 1.2880 after falling to 1.2840. But the renewed Brexit concerns are seeing the Pound get hindered in the broader market scope, with earlier hopes for a last-minute agreement emerging this week, once again getting beaten on the rocks.

GBP/USD – Technical Outlook

On the 4 hour chart, the cable took a bearish turn to test the resistance come support level at $1.2975, but it failed to give us a bearish crossover. This signifies uncertainty regarding the bearish reversal in the pair. The GBP/USD pair may face an immediate resistance near $1.2950 and $1.3045 along with a support near $1.2750.

Key Economic Events To Watch Today

Average Earnings Index 3m/y – It’s a leading indicator of consumer inflation and shows a change in price for businesses and the government pay for labor, including bonuses. Simply put, when businesses pay more for labor, the higher costs are usually passed on to the consumers, which leads to inflation.

The UK’s Office for National Statistics reported 2.7% average earnings in September, whereas, economists are expecting it to rise by 3% in this month.

Unemployment Report – It’s one of the most eyed economic data as it shows a change in the number of people claiming unemployment-related benefits during the previous month. The recent jobs report is expected to be neutral. Jobless claims rose to 18.5k in September, but economists are expecting a lesser number (4.3k) of claims in October. The smaller figure shows a growth in the labor market and it encourages the BOE (Bank of England) to keep the policy hawkish.

In addition to this, the unemployment rate is expected to remain unchanged at 4%.

Daily Technical Levels

Support Resistance
1.2897 1.3114
1.2819 1.3253
1.2602 1.347
Key Trading Level: 1.3036

GBP/USD – Trade Plan

Since the UK economy is due to release the labor market report today, the movement in the cable is highly dependent upon the outcome. Growth in the labor sector will help us capture a buying trade in the GBP/USD, and vice versa.

Hence, the idea is to stay bullish above $1.2835 with 20 pips stop loss and 60 pips take profit. I will be looking to take a sell position on the violation of $1.2835 support as this may lead the GBP/USD towards $1.2700 today.

Good luck!