The Great Britain Pound (GBP) extended upside movement against the US Dollar (USD) on Friday, increasing the price of cable to more than 1.2250 following the release of initial jobless claims news from the United States. The technical bias remains bullish in short term because of a higher high in the recent upside rally.
Technical Analysis
As of this writing, the pair is being traded around 1.2280. A hurdle may be seen near 1.2328, the horizontal resistance area ahead of 1.2672, another major horizontal resistance and then 1.2778, the swing high of the last major upside rally.
On the downside, the pair is likely to find a support near 1.2200, the psychological number ahead of 1.2111, the horizontal support area and then 1.1916, the swing low of the last major downside move as demonstrated in the given above daily chart. The technical bias shall remain bullish as long as the 1.2082 support area is intact.
US Job Data
The US initial jobless claims came in right on expectations at 265K. This was down 10K from last week. The four-week average fell slightly to 263K from 263.75K.
US continuing claims rose to 2102K versus 2027K estimate. Last week continuing claims were revised to 2039K from 2036K.
Trade Idea
Considering the overall technical and fundamental outlook, buying the pair around current levels appears to be a good strategy in short to medium term. Alternatively, selling the pair near 1.2750 could also be a good option. It is always recommended to place tight stop loss and take profit levels for every position.
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