GBPUSD, Day
The British Pound started the year in the 1.3500 zone, after moving up from the 2021 lows just two weeks before the end of the year following a surprise move by the BoE, who voted to raise interest rates from 0.1% to 0.25% amid the heavy omicron outbreak. The long-term view of GBPUSD cannot be changed, as in the Day timeframe it appears that although the price has managed to rise above the MA50 line, it is confined to the upper channel line at the 1.3600 zone. However, the 1.3600 test this time is still supported by the MACD which continues to move in significant positive territory, as well as the RSI that has room to continue upward, which could mean a support area should the Non-Farm Employment figures tonight come out lower than expected. However, if the numbers are better than expected the price may have to test 1.3500 again.
In a smaller timeframe like H4, the GBPUSD pair’s rally following the announcement of a rate hike amid the omicron surge has continued to see bearish divergence. As a result, the price has tested the MA50 line twice, which means that if the Non-Farm numbers are good, we will see the price retrace 1.3500 along with the MA50 line, which will have the next support at the MA200 line in the 1.3350 zone.
As for the data on the economic calendar this week, it’s a bit sparse for the UK. Yesterday’s final readings of service sector PMI in December was revised up from 53.2 to 53.6, which is lower than the previous month’s 58.5 reading. It also pointed to the worst month for growth in service business activity since March last year.
The data to keep an eye on today is the British construction sector PMI, while the key data will come from the US side, including Non-Farm Employment, Average Hourly Income and the Unemployment Rate.
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Chayut Vachirathanakit
Market Analyst – HF Educational Office – Thailand
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