GBP/USD jumps to session tops, inching back closer to 1.30 mark

The GBP/USD pair refreshed daily tops during the early European session, with bulls now eyeing a move towards reclaiming the key 1.30 psychological mark.

Following the previous day's negative move and a subsequent bounce from sub-1.2900 levels, the pair managed to regain positive traction and was being supported by the ongoing US dollar pullback from multi-year tops.

GBP/USD supported by weaker USD

The greenback witnessed some follow-through long-unwinding on Tuesday amid speculations that the Fed could cut interest rates sooner rather than later to offset any negative impact from the coronavirus pandemic.

The USD bulls seemed rather unimpressed by a goodish pickup in the US Treasury bond yields, while persistent market concerns over a no-deal Brexit also did little to hinder the pair's intraday positive momentum.

It will now be interesting to see if the pair is able to capitalize on the positive momentum or runs out of the steam at higher levels amid the UK’s diverging stance over the future trade deal with the European Union (EU).

Hence, the key focus will be on the EU's mandate for the key trade talks and future relationship with the UK. Any subsequent Brexit-related headlines will play a key role in influencing the sentiment surrounding the British pound.

Technical levels to watch

Momentum beyond the 1.30 mark is likely to confront stiff resistance near 50-day SMA, around the 1.3035-40 region, above which the pair is likely to build on the ongoing recovery from YTD lows. On the flip side, immediate support is pegged near mid-1.2900s, which if broken might turn the pair vulnerable to accelerate the slide back towards testing sub-1.2900 levels.