Pound Strengthens on Upbeat Employment Data as BoE Interest Rate Decision Looms

The British Pound (GBP) is gaining strength and pushing towards the key resistance level of 1.2300. This is driven by improved market sentiment and better-than-expected employment data. The UK Office for National Statistics (ONS) reported that the labor market experienced job losses for the third consecutive quarter up to August, although the actual number of jobs lost was lower than anticipated. Additionally, the Unemployment Rate dropped and remained below expectations, signaling stable labor market conditions.

The slowdown in labor demand in the UK is attributed to the challenging economic environment, which includes higher borrowing costs imposed by the Bank of England (BoE). The BoE has been aggressively increasing interest rates to control consumer inflation and bring it down to 2%. Investors are now closely watching for the upcoming BoE interest rate decision, scheduled for November 2. It is widely anticipated that the BoE will maintain interest rates at 5.25%, given the growing indications of economic weakening.

The GBPUSD price action shows a double-bottom pattern similar to the EURUSD pair. The resistance level at 1.2300 is the neck where a breakout from it represents a reversal that will take the price toward the next target at 1.2450.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.2570	1.2450	1.2300	1.2200	1.2100	1.2000