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Forex pairs in this Article » GBP/USD
FXstreet.com (Athens) – The GBP/USD broke the 1.6200 handle after the release of the very dismal NFP data.

GBP/USD broke 1.6200 handle; market pricing out taper even deeper in 2014

The GBP/USD broke initially the 1.6200 handle touching the area as of 1.6209, i.e. having gained more than 70 pips after the release. Briefly, US non-farm payrolls release was a great disappointment as NFP grew by only 148K in September, following the August increase of 193K, according to data released today by the US Department of Labor. The result was considerably below market consensus of 180K, thus markets have already started to price out that Fed will continue its monetary easing programs much deeper in 2014. Therefore risk-on sentiment hit the “on” button, the greenback got severely wounded across the board and the cable moved abruptly upwards. However, market participants should take into major consideration that while risk appetite is well back and the EUR/USD, AUD/USD printed new highs, the cable didn’t follow much this uptrend movement. Reading between the lines, this could be interpreted by investors as that the cable has run out of its uptrend momentum.

Technical Aspects on the GBP/USD

Karen Jones Head Technical Analyst of Commerzbank, GBP/USD is starting to falter just ahead of the 1.6259 current October high – this together with the 1.6302/69 2012 highs and 2009-13 resistance line should act in unison to offer some tough overhead resistance for the market. We find it somewhat surprising that the market remains at this elevated level, but are cautiously bearish at this critical zone. Intraday charts are suggesting one final thrust to 1.6255/90 ahead of failure. Only a slide through last week’s 1.5896 low will alleviate current upside pressure. Failure there will target the 38.2% Fibonacci retracement of the July-to-October advance at 1.5707 and possibly 1.5536, the 50% retracement.”
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