The GBP/USD has rallied to 1-week highs after a disappointing Non-farm Payrolls (NFP) report.
According to data released by the US Department of Labor, 266K jobs were added to the US economy in April, a far cry from the market projection of 990K and less than last month’s downward revision of 770K jobs. The unemployment rate came in at 6.1%, which also exceeded estimates of 5.8% and the previous reading of 6.0%.
The disappointing report piled additional selling pressure on the greenback. It allowed the GBP/USD pair to grab some demand at the start of the New York session, powering the pair upwards by 0.55% to 1-week highs.
Average hourly earnings came in 0.7%, which beat the 0.0% that markets expected. It also exceeded the previous number of -0.1%. This factor and jitters over the outcome of the Scottish election might limit the upside.
Technical Levels to Watch
The daily candle is now testing the resistance at 1.39484, where the triangle’s upper border is found. A breakout opens the door towards 1.40005, with the potential for a further advance towards 1.40602 and 1.41535.
On the other hand, a rejection at the current resistance allows for a return to the opposing triangle border, targeting 1.38616. A breakdown at this border negates the bullish breakout expectation and opens the door towards 1.38126. Additional downside targets at 1.37463 and 1.36771 become relevant if the decline is extensive.