Key Points
- The British Pound after trading as low as 1.4092 vs the US Dollar recovered by more than 50 pips.
- The GBPUSD pair is currently facing resistance near a very important technical level of 1.4210.
- In the UK, the Claimant Change released by the National Statistics posted a change of -0.4K in May 2016, better than the forecast.
- The UK ILO Unemployment Rate dropped from 5.1% to 5%, whereas the market was not expecting any change.
Technical Analysis
The British Pound collapsed vs the US Dollar recently and traded towards the 1.4100 support area where buyers somehow managed to protect further downside. The GBPUSD pair is currently recovering, but facing a couple of bearish trend lines on the hourly chart as a resistance.
Moreover, the 50% Fib retracement level of the last drop from the 1.4334 high to 1.4098 low is also acting as a resistance for the pair.
As long as the pair is below the resistance levels, it may move down once again.
UK Claimant Change
Today in the UK, the Claimant Change, which presents the number of unemployment people in the UK was released by the National Statistics. The market was not expecting any change in May 2016, but the result was better, as the Claimant Change came in at -0.4K.
Moreover, the UK ILO Unemployment Rate dropped from 5.1% to 5%, which was not expected by the market. The report stated that “Between the 3 months to January 2016 and February to April 2016, the number of people in work increased, the number of unemployed people fell, and the number of people not working and not seeking or available to work (economically inactive) fell slightly”.
Overall, the report was positive, and helped the GBPUSD pair. However, the highlighted resistance areas may continue to act as a barrier.
