GBP/USD spikes to fresh monthly highs, inching closer to 1.30 mark

The selling bias around the greenback remains unabated, with the GBP/USD pair surging to fresh monthly tops and now inching back closer to the key 1.30 psychological mark.

Wednesday's hawkish remarks by the BoE Governor Mark Carney, supporting case for removal of additional stimulus provided an additional boost to the pair's recovery move from sub-1.2600 level touched last week. This coupled with a heavily offered tone surrounding the buck further collaborated to the pair's strong rally over the past three trading sessions. 

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Despite of the recent comments by the Fed Chair Janet Yellen, reiterating prospects for gradual rate tightening path, skepticism over the US President Donald Trump's ability to deliver on promised pro-growth economic policies and a batch of mixed US economic data has deteriorated sentiment surrounding the greenback. 

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With the key US Dollar Index losing ground for the third consecutive session, and holding near multi-month lows, a follow through bullish momentum for the pair, back towards yearly tops beyond the 1.30 handle, now seems a distinct possibility. 

On the economic data front, the final US Q1 GDP growth number and the usual weekly jobless claims data would now be looked upon for some immediate respite for the USD bulls. 

Technical levels to watch

Momentum above the 1.30 mark is likely to lift the pair back towards yearly tops resistance near 1.3040-50 region, touched in May, above which a fresh bout of short-covering has the potential to continue boosting the pair even beyond the 1.31 handle towards its next major hurdle near 1.3160-65 region.

On the flip side, retracement back below mid-1.2900s now seems to find strong buying interest near the 1.2900 round figure mark and hence, should limit any further downslide near 1.2880-75 horizontal support.