GBP/USD once again fails to find acceptance above 1.2500 handle

Upbeat US durable goods orders kept a lid on the pair’s intraday up-move.
Barnier’s comments do little to ease no-deal Brexit fears and exert pressure.
Technical set-up support now prospects for a slide back towards weekly lows.

Haresh Menghani FXStreet

Having touched an intraday high level of 1.2518, the GBP/USD pair met with some fresh supply and is currently placed near the lower end of its daily trading range.

The pair continued with its struggle to sustain/build on the momentum beyond the key 1.2500 handle and quickly retreated around 40-pips from daily tops, albeit a modest US Dollar pullback from multi-week tops seemed to help limit the downside.

The latest leg of a slide since the early North-American session came after the release of upbeat US durable goods orders data, which reaffirmed expectations that the Fed is unlikely to deliver a 50 bps rate cut at its upcoming meeting on July 30-31.

This was evident from a sharp intraday upsurge in the US Treasury bond yields, which coupled with some cross-driven weakness - stemming out of the post-ECB solid rebound in the EUR/GBP cross, further collaborated to the pair's intraday downfall.

Meanwhile, the latest comments by the European Union's Brexit negotiator Michel Barnier, saying that the new UK PM Boris Johnson's demand to eliminate the backstop was unacceptable, did little to ease fears of a no-deal Brexit and might prompt some fresh selling around the British Pound.

Hence, a follow-through weakness, back towards challenging weekly lows support near the 1.2420-15 region, now looks a distinct possibility.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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