GBP/USD Signal 02/10: 1.33 - 1.30 Break Ahead Of NFP (Video)

(MENAFN- Daily Forex) Potential signal

I am buying above 1.33, with a stop loss below 1.32, and will short this pair below 1.30, with a stop loss at 1.31 above. It's a binary set up.

The British pound continues to see a lot of downward pressure against the US dollar, but we are now looking at the massive support underneath being tested. At this point, the Non-Farm Payrolls looks to be a“live report.”

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Recently, over the last six months or so, we've seen this area between 1.32 and 1.3150 offer support. This is very interesting to me because we also have the jobs report coming out on Friday in the United States. It's worth noting that the stochastic oscillator is in oversold conditions. We have not had the clean crossover I like to see, but it is at a very low level. It's an area where you would expect to see a bounce Payroll will matter, all things being equal

If we get a poor jobs report, that might have traders hoping that the Federal Reserve is going to cut rates. In the environment that the jobs number comes out weaker than anticipated, I might be a buyer of this. I certainly will be paying attention to how this finishes the day on Friday because the Friday session will be yet another piece of information that will give us an idea of how inflation may behave.

For example, inflation right now has recently seen the PCE numbers miss, and the GDP numbers come in hotter than anticipated. With all of that being said, this is a market that I think, if we get some type of confirmation one way or the other, it may finally clear some of the dust.

The Bank of England is a little bit more dovish than the Fed. We do know that there were three members that voted to cut last time, so we'll see how that plays out. But in the short term, we're at a major area of confluence.

I'll be watching to see if we bounce here, maybe for a run to 1.33, maybe a move to 1.34. A breakdown from here opens up a move down to the 1.30 level.

EURUSD Chart by TradingView

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