GBP/USD drops further, challenges 1.2920/10
|The selling pressure around the British pound is now gathering extra pace, relegating GBP/USD to test daily lows in the proximity of 1.2920.
GBP/USD looks to EUR/GBP
Spot is deriving further selling pressure from the unabated upside momentum in EUR/GBP, which continues its march north towards the key 0.8700 neighbourhood.
Adding to GBP weakness, BBA’s Mortgage Approvals have missed estimates during August, coming in just below 37K vs. 37.2K expected and down from nearly 37.7K from the previous month.
In the meantime, the pair is trading at shouting distance from multi-week lows in the 1.2910 area, opening the door for a deeper pullback in case of positive results from today’s US docket: New Home Sales and the Dallas Fed manufacturing index, followed by speeches by FOMC’s Kashkari, Tarullo and Kaplan.
GBP/USD levels to consider
As of writing the pair is losing 0.18% at 1.2932 facing the next support at 1.2912 (low Sep.23) followed by 1.2863 (low Aug.15) and then 1.2796 (2016 low Jul.6). On the other hand, a breakout of 1.3125 (high Sep.22) would open the door to 1.3447 (high Sep.6) and finally 1.3584 (100-day sma).
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