GBP/USD refreshes daily low, 1.3200 back in sight amid resurgent USD demand

GBP/USD witnessed an intraday turnaround from the vicinity of the 1.3300 mark on Tuesday.
Hawkish Fed expectations continued underpinning the USD and exerted pressure on the pair.
Some follow-through selling below the 1.3200 mark will set the stage for additional losses.

Haresh Menghani FXStreet

The USD caught some bids during the early North American session and dragged the GBP/USD pair to a fresh daily low, around the 1.3220-15 region in the last hour.

The pair struggled to capitalize on its modest intraday gains, instead met with a fresh supply near the 1.3290 area on Tuesday amid a modest pickup in the US dollar demand. Growing market acceptance that the Fed would hike interest rates sooner rather than later to contain stubbornly high inflation continued acting as a tailwind for the USD.

Apart from this, a further recovery in the US Treasury bond yields underpinned the buck and exerted downward pressure on the GBP/USD pair. Bulls failed to gain any respite from the prevalent risk-on mood – which tends to undermine the safe-haven greenback – and largely shrugged off the prospects for an imminent rate hike by the Bank of England.

With the latest leg down, the GBP/USD pair has now eroded a major part of the overnight recovery gains and moved well within the striking distance of the 1.3200 mark. A convincing break below the latter will be seen as a fresh trigger for bearish traders and set the stage for additional losses amid persistent Brexit-related uncertainties.

In the absence of any major market-moving economic releases, the USD price dynamics will continue to play a key role in influencing the GBP/USD pair and produce some short-term trading opportunities. Traders will further take cues from the US bond yields, developments surrounding the coronavirus saga and the broader market risk sentiment.

Technical levels to watch

GBP/USD

Overview
Today last price	1.3228
Today Daily Change	-0.0028
Today Daily Change %	-0.21
Today daily open	1.3256

Trends
Daily SMA20	1.3373
Daily SMA50	1.3539
Daily SMA100	1.3664
Daily SMA200	1.3798

Levels
Previous Daily High	1.3287
Previous Daily Low	1.322
Previous Weekly High	1.3371
Previous Weekly Low	1.3194
Previous Monthly High	1.3698
Previous Monthly Low	1.3194
Daily Fibonacci 38.2%	1.3261
Daily Fibonacci 61.8%	1.3246
Daily Pivot Point S1	1.3222
Daily Pivot Point S2	1.3188
Daily Pivot Point S3	1.3156
Daily Pivot Point R1	1.3288
Daily Pivot Point R2	1.332
Daily Pivot Point R3	1.3354

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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