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GBP/USD spikes to mid-1.3300s, highest since early Oct.

   •  Moves past 1.3330-35 supply zone.
   •  Rising US bond yields fail to revive USD demand. 
   •  On track for third consecutive week of positive close. 

After an initial dip to 1.3280 area, the GBP/USD pair regained traction and spiked to fresh multi-week tops (mid-1.3300s) in the past hour.

A fresh wave of greenback selling interest emerged during the early NA session and has been one of the key factors driving the pair higher. In fact, key US Dollar Index sank below the 93.00 handle and provided an additional boost to the pair's near-term bullish momentum.

The latest leg of USD selling bias lacked any major catalyst and could be attributed to the Wednesday's dovish FOMC meeting minutes, which diminished prospects for an aggressive rate hike move post-December. 

With today's up-move, for the eighth day in the previous nine sessions, the pair has gained in excess of 250-pips from sub-1.3100 level touched last week and remains on track to end on a positive note for the third consecutive week. 

Currently holding near its highest level since early October, the upcoming releases of the flash US manufacturing and services PMIs is unlikely to hinder the pair's upward trajectory but would still be looked upon for some immediate respite for the USD bulls. 

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes: "the pair retains its positive stance, as the early slide met buying interest around a bullish 20 SMA, while technical indicators remain within positive territory, although without directional strength. The pair continues developing within an ascendant channel and would take a bearish acceleration through 1.3260 to change the positive bias, something unlikely considering broad-based dollar's weakness."
 

Author

Haresh Menghani

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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