GBP/USD eases from tops, once again fails ahead of 50-day SMA
| • The prevalent USD selling bias helped build on last week’s strong rebound.
• Focus remains on UK Parliament debate/meaningful vote on May’s Brexit deal.
• Today’s release of US ISM non-manufacturing PMI eyed for some trading impetus.
The GBP/USD pair extended its sideways consolidative price action and remained confined in a narrow trading range, around mid-1.2700s.
The prevalent US Dollar buying interest helped the pair to preserve, rather build on last week's swift recovery from sub-1.2400 level, or 21-month lows, and continued gaining positive traction for the third consecutive session.
Despite blockbuster US monthly jobs report, growing speculations that the Fed will pause it policy tightening cycle in 2019 kept the USD bulls on the defensive and turned out to be one of the key factors driving the pair higher.
Adding to this, optimism over a possible resolution to the US-China trade disputes continued boosting risk appetite and further dented the greenback's safe-haven status, and remained supportive of the positive move.
The pair touched an intraday high level of 1.2765, albeit lacked any strong follow-through and once again failed ahead of 50-day SMA amid absent relevant market moving economic releases from the UK.
Moreover, investors also seemed to refrain from placing aggressive bets ahead of the upcoming UK Parliament debate on the PM Theresa May's Brexit deal, set to resume this Wednesday, and the meaningful vote on January 15.
In the meantime, today’s US economic docket, featuring the release of ISM non-manufacturing PMI, will now be looked upon for some short-term momentum play later during the early North-American session.
Technical levels to watch
The 1.2710-1.2700 region now seems to protect the immediate downside, below which the retracement slide could further get extended towards the 1.266050 support area. On the flip side, the 50-day SMA, currently near the 1.2770-80 region, might continue to act as an immediate strong hurdle, which if cleared could further lift the pair to reclaiming the 1.2800 round figure mark.
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