Trading Forex and CFDs is risky

Cable back to 1.2100 levels

Market Analysis
2017-03-15_12-17-24

GBPUSD, H1

This morning, sterling rallied in the wake of a Bloomberg report, saying that the EU won’t authorize Brexit negotiations until June 20th, despite clear communication from the UK government over the last six months that it will invoke Article 50 by the end of March (repeated by a PM spokesperson earlier in this week). The pound showed an average 0.4% gain versus the G3 currencies as London interbank participants take to their positions. Cable clocked a nine-day high at 1.2258 earlier, which was well up on the 1.2109 eight-week low of yesterday.

Additionally today, UK unemployment data unexpected fell to 4.7%, a new cycle low in official ILO data for January. The median expectation had been for an unchanged 4.8% reading. The soon-to-be discontinued measure on jobless claims in February fell 11.3k, and the claimant count rate remained at 2.1%, which is also the cycle low. Average earnings data were disappointed, with the ex-bonus average household income ebbing to a growth rate of 2.2% y/y in the three months to January, down from 2.6%, and the with-bonus figure falling to 2.3% from 2.6% previously.Sterling took a tumble on the back of the soft pay numbers, which comes with inflation rising and adds to signs that consumer-driven economic growth is in stagnation. This in turns raises the possibility for BoE guidance to take a dovish turn at tomorrow’s post-March meeting announcement.

In the announcement of UK labour data, Cable settles back in the 1.21s levels, by breaking 50 period MA and 200 period EMA, in the hourly chart. The 1 hour GBPUSD chart however remains bulling, since Monday with positive Parabolic SAR, and MACD moving neutrally since its turn earlier today. In 4-hour chart, pair manage to broke the 50-period moving average twice today, firstly upwards and now downwards. RSI is neutral but is pointing downwards. Even though Cable today seems to run out of steam, its performance onwards depends mainly in US data and Fed’s meeting later on.

Click here to access the HotForex Economic calendar.

Want to learn to trade and analyse the markets? Join our latest webinar and get analysis and trading ideas combined with better understanding on how markets work.

Click HERE to register the next webinar will start in:

Andria Pichidi

Market Analyst

HotForex

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.