GBP/USD plummets below 1.42 handle after stellar US jobs report

The GBP/USD pair extended its retracement slide from weekly tops and tumbled below the 1.4200 handle following the release of upbeat US employment details.

The US Dollar spiked across the board after the latest US jobs report showed that the economy added 200K new jobs in January and the unemployment rate held steady at 4.1%. Adding to the positive headline print, average hourly earnings posted a strong y-o-y growth of 2.9% and surpassed the most optimistic estimates.

Against the backdrop of today's dismal UK construction PMI, better-than-expected US jobs data prompted some fresh selling and dragged the pair to an intraday low level of 1.4166. 

The pair has now reversed all of the previous session's strong up-move and a follow-through weakness, led by additional long-unwinding, now looks a distinct possibility.

Technical levels to watch

Subsequent weakness below the 1.4155-50 region now seems to accelerate the fall back towards the 1.4100 handle en-route its next horizontal support near 1.4070-60 zone. On the upside, any meaningful bounce back above the 1.4200 handle now seems to confront strong barrier near the 1.4240-60 region, which if cleared should assist the pair to make a fresh attempt towards conquering the 1.4300 handle.