The GBP/USD pair regained some positive traction at the start of a new trading week and is currently placed comfortably above the key 1.35 psychological mark. The market seems to have digested Moody's downgrade of the UK's credit rating on Friday, lowering the long-term rating to Aa2 from Aa1 and changing the outlook to stable from negative.
The pair, however, has held within its consolidative trading range and lacked any firm near-term directional bias as investors seemed non-committal ahead of the fourth round of Brexit talks, starting today. In absence of any major market moving economic releases, news coming out of the Brexit negotiations would remain a key determinant of the pair's movement through European trading session on Monday.
From a technical perspective, the pair has been finding some fresh buying interest near the 1.3450-40 region and hence, it would be prudent to wait for a decisive break below the mentioned support before confirming that the pair might have topped out in the near-term.
Sustained weakness below the mentioned support might trigger a corrective slide and accelerate the fall towards the 1.3400-1.3380 intermediate support before the pair eventually drops to test the 1.3300 handle.
Traders, however, would wait for a strong follow-through buying interest beyond the 1.3600 handle before committing to any additional near-term appreciating move, even beyond yearly tops resistance near 1.3660 level towards reclaiming the 1.3700 round figure mark. The bullish momentum could further get extended towards the 1.3800 handle ahead of the next major hurdle near mid-1.3800s.
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