GBP/USD retreats from 1-week tops, approaching 1.2900 mark
|- GBP/USD fails to capitalize on the early uptick and runs out of the steam near mid-1.2900s.
- Uncertainty over the outcome of the UK election seemed to be a factor exerting pressure.
- The downside seems more likely to remain limited amid weaker USD, thin liquidity conditions.
The GBP/USD pair failed to capitalize on its early uptick to one-week tops and is currently placed near the lower end of its daily trading range, just above the 1.2900 handle.
The pair gained some follow-through traction during the early part of Thursday's trading action and added to the overnight gains, hitting one-week tops amid increasing odds of a significant majority for Conservatives.
Focus remains on UK politics
In fact, the latest poll by YouGov MRP, released on Wednesday, predicted that the UK Prime Minister Boris Johnson's Conservative Party will win 359 seats as against 211 for Labour, 13 for LibDems and 43 for SNP.
However, the fact that every other opinion poll has been hinting at a narrowing lead for the Tories, the positive momentum quickly ran out of the steam, rather met with some fresh supply near the 1.2950 supply zone.
Apart from the UK political uncertainty, the downtick lacked any obvious fundamental catalyst and seems more likely to remain limited. A subdued US dollar price action might lend some support amid holiday-thinned liquidity conditions.
Hence, it will be prudent to wait for some strong follow-through selling, possibly below the 1.2900 handle, before traders start positioning for any further intraday pullback.
Technical levels to watch
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