GBP/USD pinned to 1.33 on fresh Brexit concerns, technical correction already running out of steam

  • GBP flattens out at the 1.33 key level after slipping on renewed Brexit concerns for the new week.
  • Mid-tier data for Tuesday will be seeing risk appetite deciding the pair's direction.

The GBP/USD is trading near the 1.3300 major handle ahead of Tuesday's London session after declining in Monday's action.

The Sterling knocked lower on Monday after the UK Construction PMI for May came in unchanged, piling on in a week that has already seen Brexit concerns swing back to the forefront, with little resolution seen on the current Ireland border issues, post-Brexit trade conditions, and a Brexit withdrawal bill due in the House of Commons on June 12th. The GBP has managed to hit the brakes on the decline, and has steadied out near the 1.3300 major level after clocking in a daily high just beneath 1.3400 in Monday's trading.

Tuesday brings the UK's Markit Services PMI for May, expected at 53.0 compared to the previous reading of 52.8. The BRC Like-For-Like Retails Sales indicator dropped some positive figures in the late Monday session, printing at 2.8% compared to the expected 0.8% drawdown and the previous contraction of -4.2%. 

GBP/USD levels to watch

FXStreet Chief Analyst Valeria Bednarik on the Sterling's technical stance heading into Tuesday's London markets: "the GBP/USD pair 4 hours' chart presents a neutral stance heading into the Asian session, as the pair is now struggling around a flat 20 SMA, while technical indicators have pulled back from near overbought readings, the Momentum now heading nowhere around its 100 level, but the RSI maintaining the downward slope at 46, leaning the scale toward the downside for the upcoming sessions."

Support levels: 1.3290 1.3245 1.3200    

Resistance levels: 1.3375 1.3420 1.3460

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