The number of job openings in the US soared to 10,073,000 from 9,483,000. The reading was expected to drop to 9,000,000. Moreover, previous results were upwardly revised. Generally speaking, the outcome of the Labor Department report outperformed even the most optimistic expectations.
As a result, instead of the pound sterling’s correction, the greenback continued to strengthen. Indeed, it only made the US dollar even more overbought. Therefore, a correction is needed. The problem is that the macroeconomic calendar is completely empty today. So, technically, there is no reason for a correction.
Consequently, the market is likely to move sideways today. Tomorrow, however, inflation data will be published in the US. Investors should prepare for such a significant event. In other words, the greenback may gradually weaken during the day.
United States Job Openings:
The GBP/USD pair left the sideways channel of 1.3900/1.4000 and broke its lower border. The volume of short positions has increased at the moment the price consolidated below the 61.8% retracement level from the Fibonacci fans.
The Moving Average Convergence/Divergence indicator (MACD) crossed the zero mark from top to bottom, thus giving a reversal signal. The sell signal comes with a pullback from the resistance level, as well as the recovery of the price relative to the upward trend as of July 21-30.
Outlook
The market is expected to remain bearish. The quote should consolidate below the 38.2% Fibonacci retracement level of 1.3825 to cause an increase in short interest. Otherwise, the price may rebound to 1.3880.
InstaForex Group