GBP/USD retreats from 2-week tops, bulls shrug off upbeat UK PMIs

The GBP/USD pair faded an intraday bullish spike to fresh two-week tops, levels beyond mid-1.3100s, and has now retreated to the lower end of its daily trading range.

Following the previous session's modest pullback, the pair managed to regain some positive traction on the last day of the week and the uptick got a minor lift following the release of stronger-than-expected UK PMI prints.

In fact, the flash version of the UK Manufacturing PMI for January moved closer to the expansion territory and came in at 49.8 as compared to a bounce to 48.9 expected and the previous month's final reading of 47.5.

Adding to this, the preliminary UK Services PMI also bettered market expectations by printing 52.9 for January and prompted traders to scale back expectations of a BoE rate cut at its policy meeting next week.

Despite the supporting factors, the pair failed to capitalize on the positive momentum, rather met with some aggressive supply at higher levels and quickly retreated around 45-50 pips over the past hour or so.

It will now be interesting to see if the pair is able to attract any dip-buying at lower levels or the current pullback marks the end of the recent positive momentum and the resumption of the prior corrective slide.

Technical levels to watch