The GBP/USD pair extended bounce off a short-term ascending trend-line support, and has now reversed majority of Friday's disappointing UK retail sales-led slide to sub-1.2400 level.
The pair, however, trimmed some of its gains to session peak level near 1.2480 region and is currently trading around 1.2455-60 region. Despite of the pull-back, the pair has managed to maintain its strong bid tone and in absence of any market moving economic releases, Monday's recovery could be attributed to some short-covering amid largely subdued US Dollar price-action and repositioning ahead of House of Lords debate on Article 50, later during the day.
Live – House of Lords debate on Article 50
Meanwhile, holiday thin market liquidity conditions, in wake of a holiday in the US markets, could have contributed towards aggravating the move and infusing some volatility around the major.
Meanwhile, focus would remain on this week's key event risks - the second estimate of UK GDP growth numbers and the FOMC meeting minutes, which would help investors to determine the next leg of directional move for the major.
Technical levels to watch
Momentum above session peak resistance near 1.2480 level could get extended towards 1.2500 psychological mark above which the pair seems all set to head towards 1.2565-70 resistance area ahead of 1.2600 round figure mark.
On the downside, retracement back below 1.2440 level, leading to a subsequent break below 1.2420 area, could drag the pair back towards the ascending trend-line support near 1.2400 handle, which if broken decisively might accelerate the slide towards 1.2350-45 area before the pair eventually breaks below 1.2300 handle and head towards testing its next support near 1.2260-55 region.
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