UK Labor Data Fuels Rally on GBPUSD to the Top of the Symmetrical Triangle. Can It Breakout?

The pound surged in today’s European trading as the employment data from the UK topped forecasts. GBPUSD is up close to 50 pips from where it was trading an hour ago at 1.3036.

According to data from the Office for National Statistics, Claimant Count Change for December was at 14,900. Meanwhile, the forecast was for an increase of 33,400 in the number of people who filed for unemployment benefits. The unemployment rate printed at steady for November, the same as in October. Average hourly earnings for November was higher than anticipated at 3.2% versus the 3.1% consensus.

These figures bring a wave of relief to pound bulls. The recent data from the UK pointed at weaknesses in the economy and only fueled speculations from a rate cut from the Bank of England (BOE). Although today’s reports are not enough to suggest that growth in the country is robust, they could be enough reason to keep the central bank from cutting rates in its next meeting.

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GBPUSD Outlook

GBPUSD is now testing resistance at the top of the symmetrical triangle on the 4-hour time frame. This chart pattern is often considered as a consolidation. However, an upside break could mean that there are enough buyers in the market to push GBPUSD higher. A bullish close above 1.3045 could mean that the currency pair may soon rally to its January 17 high at 1.3100. On the other hand, reversal candles may mean that GBPUSD could still fall to the bottom of the triangle at 1.2990.

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