GBPUSD – Pair had moved up towards the 1.55 handle after the release of a set of bullish jobs data. on top of that, the UK Claimant Count Change is the data that moved this pair. The figure came in better than expected for July at -29.2k versus -15k. Also the unemployment rate arrived in line with expectations at 7.8% and the vote from the MPS is that they are going to leave the rates unchanged.
Do take note however that there are divisions in the MPC with the doves and the hawks split in the idea of to carry on with QE or to stop it as soon as they can. The dovish side is still looking at more QE as one way to further support the UK economy while the other side believes that the UK is ready to wean itself from QE.
From the daily time frame above, we can see that the pair is trying to make attempts to go above the down trend line that I have marked in red. Ability to close above that trendline will open the door for the pair to test its June 17 resistance at around the 1.57 level. However, failure to penetrate the 1.56 level will spell trouble for this pair which in my opinion is at the whim and fancy of the rates markets.
We should also be mindful of data that is going to affect the pair this week. we do not have much on the cards except for tomorrow where we are going to get the Retail sales figures.
All the best to your trading.