GBP/USD jumps above 1.2700 post-UK jobs data, lacks follow-through

  • Upbeat UK average earnings growth data provides a minor lift to the British Pound.
  • Rising fears of a no-deal Brexit kept a lid on any strong follow-through positive move. 

The GBP/USD pair quickly reversed an early European session dip, with bulls now looking to extend the momentum further beyond the 1.2700 handle post-UK jobs data.

The British Pound picked up the pace in the last hour after the latest UK employment report came in to show that average earnings excluding bonus recorded a strong yearly growth of 3.4% during the three months to April as against a slight deceleration anticipated. 

Adding to this, earnings including bonus also came in better-than-expected and helped offset a slight disappointment from the Claimant Count Change, showing that the number of people claiming unemployment-related benefits rose 23.2K in May as compared to the previous month’s downwardly revised reading of 19.1K.

Despite the positive trigger, the pair lacked any strong bullish conviction as investors remain convinced that a hard-line Brexiteer could be the next British PM and lead to a no-deal split. Hence, it would be prudent to wait for a strong follow-through buying before positioning for any further near-term appreciating move.

Technical levels to watch

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