GBP/USD slips below 1.3700 mark, fresh session lows post-US data
|- A goodish pickup in the USD demand prompted fresh selling around GBP/USD on Wednesday.
- An uptick in the US bond yields, slightly better US Durable Goods Orders benefitted the USD.
- The risk-on impulse might cap gains for the safe-haven buck and help limit losses for the pair.
The GBP/USD pair dropped to fresh session lows during the early North American session, with bears now looking to extend the slide further below the 1.3700 mark.
The pair struggled to capitalize on its modest intraday uptick and once again met with some fresh supply in the vicinity of mid-1.3700s. The intraday selling picked up pace heading into the North American session and was exclusively sponsored by a goodish pickup in the US dollar demand.
The USD built on the overnight bounce from one-week lows amid some follow-through uptick in the US Treasury bond yields. Expectations that the Fed could still begin rolling back its pandemic-era stimulus pushed the yield on the benchmark 10-year US government bond back above the 1.30% threshold.
The greenback maintained its bid tone following the release of US macro data, which showed the headline Durable Goods Orders decline 0.1% in July. This marked a notable deceleration from the previous month's 0.8% rise but was still better than market expectations for a 0.3% decline.
That said, the underlying bullish sentiment might hold the USD bulls from placing aggressive bets and help limit any further losses for the GBP/USD pair. Investors might also prefer to wait on the sidelines ahead of Fed Chair Jerome Powell's speech at the Jackson Hole Symposium.
Hence, it will be prudent to wait for some follow-through selling before confirming that the recent bounce from one-month lows has lost steam. Even from a technical perspective, the GBP/USD has been oscillating in a range, forming a rectangle on hourly charts and indicating indecision among traders.
Technical levels to watch
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