GBP/USD hits fresh 7-month tops, fast approaching 1.3100 handle

The GBP/USD pair added to its goodish intraday gains and climbed to fresh seven-month tops, around the 1.3080-90 region in the last hour.

The British pound remained well supported by the fact that the incoming polls have been indicating a majority for the UK Prime Minister Boris Johnson's ruling Conservative Party at the upcoming general election on December 12. The pair built on this week's goodish positive move and continued gaining traction for the third consecutive session on Wednesday.

GBP well supported by UK political optimism

The positive momentum seemed rather unaffected by a modest intraday pickup in the US dollar demand, supported by a sharp intraday upsurge in the US Treasury bond yields and some positive trade-related headlines. A Bloomberg report indicated that the US and China the US and China are moving closer to a deal before the 15 December tariffs deadline.

Meanwhile, the pair's strong move up since the early European session lacked any fresh trigger and could be solely attributed to some follow-through technical buying. Given the overnight break through a multi-week-old descending trend-channel, a sustained move beyond the key 1.30 psychological mark was seen as a key trigger for bullish traders.

The pair might now be aiming to reclaim the 1.3100 round-figure mark, albeit slightly overbought conditions on intraday charts warrant some caution before initiating any fresh bullish positions. Market participants now look forward to the US economic docket, featuring the release of ADP report and ISM Non-Manufacturing PMI, for some short-term impetus.

Technical levels to watch