GBP/USD spikes to 1.35 handle amid fresh USD supply

Haresh Menghani FXStreet

• USD selling remains unabated.
• Weaker US bond yields add to USD weakness.

A fresh wave of greenback selling emerged in the last hour and pushed the GBP/USD pair to the key 1.3500 psychological mark, or fresh 3-week tops.

In absence any fresh development, a mildly weaker tone around the US Treasury bond yields accelerated the US Dollar downfall and eventually provided a fresh boost to the pair.

Moreover, possibilities of some stops being triggered, on a decisive move above 1.3465-70 horizontal resistance, might have also collaborated to the pair's sharp upsurge of around 30-pips in the past hour or so.

Meanwhile, pre-holiday thin liquidity conditions seemed to have further aggravated the move and even from a technical perspective, the pair is currently placed near a short-term descending trend-line resistance.

Hence, it would prudent to wait for a strong follow-through buying interest before committing to any additional up-move.

Technical levels to watch

The ongoing momentum seems strong enough to continue lifting the pair towards its next major hurdle near mid-1.3500s, above which bulls would be aiming to reclaim the 1.3600 handle.

On the flip side, 1.3470 level now becomes an immediate support to defend, which if broken could accelerate the corrective slide back towards the 1.3430 intermediate support en-route the 1.3400 handle.

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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