GBP/USD surrenders early gains to 2-week tops, retreats below mid-1.3100s
| • The positive momentum stalls ahead of 1.32 mark after mixed UK macro data.
• An uptick in the US bond yields helps revive USD demand and exert pressure.
The GBP/USD pair surrendered its early gains to two-week tops and has now slipped back below mid-1.3100s, closer to the lower end of its daily trading range.
With investors looking past the latest Brexit optimism, the British Pound lost some ground following today's mixed UK macroeconomic data. The monthly UK GDP print, as published by the National Bureau of Statistics (NBS) showed that the economic growth remained flat m/m in August versus 0.1% growth expected and 0.4% previous.
Adding to the disappointment, manufacturing output unexpectedly contracted by -0.2% m/m in August as compared to 0.1% rise anticipated and an upwardly revised flat reading in July, though was largely negated by stronger than expected yearly figures.
Meanwhile, a fresh leg of an upsurge in the US Treasury bond yields helped the US Dollar to regain positive traction and further collaborated to the pair's intraday retracement of around 45-50 pips.
Moving ahead, today's US economic docket, featuring the release of September PPI figures, coupled with any fresh Brexit-related news/developments will now be looked upon for some meaningful trading opportunities.
Technical levels to watch
Any subsequent fall is likely to find support near the 1.3100 handle (100-day SMA), below which the pair is likely to accelerate the fall back towards testing the 1.2930 strong horizontal zone. On the flip side, the 1.3180-85 region now seems to act as an immediate resistance, which is closely followed by the 1.3200 handle and the 1.3220-25 supply zone.
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