The GBP/USD pair went back and forth during the course of the session on Thursday, as we continue to struggle just below the 1.52 level. That being the case, the market looks as if it still will continue to struggle, and with the Nonfarm Payroll numbers coming out today, it’s very likely that there will be a lot of volatility. This market is more than likely going to continue to see quite a bit of bearish pressure of the longer-term, so even if we get some type of knee-jerk reaction to the upside, we believe that the rally will more than likely be an opportunity to sell yet again. On the other hand, if we break down below the bottom of the candle for the session on Thursday, the market should then reach towards the 1.50 level.
Keep in mind that the British pound has been falling rather hard recently, so having said that it’s difficult to imagine that the markets going to turn right back around. That being the case, we believe that the rallies will attract a lot of attention, and you have to keep in mind that the knee-jerk reaction is very likely going to be difficult to hold onto. After all, the market has been falling for a while, and for quite a few different reasons. That hasn’t changed, and as a result the big picture will come back into play as the market goes back to what it has been doing.
On top of that, if the keep in mind that when the announcement comes out, liquidity will be very low, and as a result the movement of the market can be rather violent. Ultimately, the market will see more and more orders come back into play later in the session, calming things down and of course continuing the longer-term move typically. It is not unless we have some type of massive shock to the marketplace that we will see a significant change. After all, 202,000 jobs added for last month is the anticipated number, but having said that it is not unless we miss buy over 20,000 that we believe any knee-jerk reaction will stay in place.