A 260 pips daily jump was exhibited on the chart of the GBP/USD currency pair last Friday following the reaction to the release of the United States (US) NFP employment data report.
Although seen roughly looks positive for the NFP report for the month of December with the unemployment rate falling, but the increase in employment failed to overcome the previous month even though it was slightly higher than forecast.
The average wage income was recorded lower than expected, making the strengthening of the US dollar before that begin to stagnate.
In addition, the ISM survey data of the US service sector that followed after the NFP added to the sadness when the figure was recorded below the 50 point level.
Increasingly strengthening expectations for the Federal Reserve (Fed) to continue to ease policy drove a significant decline in the value of the US dollar.
Initially the price made an initial decline to around 1.18400 before the surge was shown to have reached the focal resistance level at 1.21000 at the end of the last session of the week.
The price increase also crossed the 1.20000 zone and broke through the Moving Average 50 (MA50) barrier on the 1-hour time frame on the GBP/USD chart, signaling a bullish trend movement.
Continuing the trade at the opening of the beginning of the week, the price moved slightly above the 1.21000 zone which was seen to continue the momentum of last week's movement.
The uptrend is expected to continue towards the next resistance zone at 1.22000 to record a recent 4-week high.
Beware if the decline occurs again below the 1.21000 zone which will push price expectations towards the 1.2000 concentration zone.
A drop lower will lead back to last week's lows and is likely to continue further down to around 1.18000.
