The British pound is consolidating
The Pound sterling is looking to make another probe to the upside and the unemployment data from the UK later today could provide the necessary trigger for this. The main reason behind the fall observed briefly yesterday has been the benign CPI data output, however that is unlikely to hold for long, especially if wage increases settle in.
We would be buying daily calls at current levels expecting a test of the 1.6750 area, while there is no guarantee whether we would be able to close above that level on an hourly basis, which would be doubling our bet, we prefer to take this chance for some easy profits after today's expiry.
The graph has spiked lower following the release of rather benign CPI data yesterday form the UK, which came out at merely 1.6%. A low at 1.6660 was established and price shave rebounded higher without any impetus for substantial selling. Current levels around 1.6627 are providing a good opportunity to buy daily calls.
But lets see first what are the key levels going forward. On the upside that is the 1.6740-50 area which has been probed numerous times since the start of the week. There should be a substantial amount of stops above that area which could trigger a big spike higher opening a move towards 1.68 in this binary options forex pair.
On the downside aside from yesterday's low which we have already mentioned standing at 1.6660, we have a trend line that is extending around 1.6670-80 currently. It will be key to overcome support bids and open a move lower towards the figure at 1.66. For now we see this as an unlikely event, however all options should be put on the table - literally!
The key data point today is the release of the unemployment figures from the UK at 08:30 GMT. The rate is expected to be announced at 7.1%, which is lower form last months 7.2% figure. The labor market in the UK is on a broad stabilization trend and the Bank of England will be keeping a close eye on it, before deciding whether to rise interest rates to combat so far nonexistent higher inflation.
As long as the pair remains within recent ranges, that should induce more ample future volatility, so stay sharp in monitoring the levels that we have mentioned above.