GBP/USD: Strong NFP wage inflation reading to push cable below 1.35

GBP/USD has been moving sideways around 1.3550 so far on Friday after closing in the negative territory on Thursday. FXStreet’s Eren Sengezer doubts buyers can defend the 1.35 level on a strong Nonfarm Payrolls report.

US December jobs report could ramp up volatility ahead of the weekend

“The market expectation is for NFP to rise by 400,000 following November's disappointing increase of 210,000. A print close to market consensus should be good enough to for the Fed to stick to its hawkish outlook.”

“The Average Hourly Earnings are forecast to edge lower to 4.1% on a yearly basis in December from 4.8% in November. The Fed is more concerned about wage inflation feeding into more persistent price pressures than a one-month increase in NFP and a strong figure could trigger a dollar rally and vice versa.”

“In case the NFP report provides a boost to the dollar, 1.3500 (psychological level, 50-period SMA) aligns as key support. A break below that level could open the for additional losses toward 1.3450 (static level) and 1.3420 (100-period SMA).”

“An interim resistance seems to have formed at 1.3565 (static level) before 1.3600 (psychological level).”