Bears are on hold above key Fibo support in European trading on Friday, as quiet and narrow range movement await release of US jobs report.
Cable registered significant losses this week, pressured by rising dollar and uncertainty over Brexit negotiations.
The greenback’s strong advance was underpinned by upbeat data which point to robust US economy growth, with highlight on US ADP private jobs report which doubled the forecast and is often use as an indication for NFP report.
This keeps optimistic view among traders and expectations for more than expected new jobs created in the US in January that would further boost dollar.
Eventual break of 1.2919 Fibo support and 23 Dec low at 1.2904 would spark stronger bearish acceleration of GBP/USD pair and expose targets at 1.2768 (8 Nov trough), 1.2736 (50% retracement of 1.1958/1.3514) and 1.2692 (200DMA).
Caution on alternative scenario which could be triggered by weaker than expected US jobs data but also traders’ decision to collect profits from strong dollar’s advance that would prompt cable to bounce from key support zone.
Res: 1.2955, 1.3000, 1.3028, 1.3040
Sup: 1.2919, 1.2904, 1.2885, 1.2822
