“¢ The recent recovery lacked strong conviction amid UK political and Brexit uncertainties.
“¢ A modest USD rebound/disappointing UK construction PMI prompts some fresh selling.
The GBP/USD pair failed to capitalize on the early uptick to one-week tops and refreshed session lows, below mid-1.2600s post-UK construction PMI.
The pair stalled its recent recovery move from nearly five-month lows and the latest leg of a sudden drop since the early European session could be solely attributed to a modest US Dollar rebound.
Despite the fact that investors have started pricing in a possible Fed rate cut by the end of this year, a goodish rebound in the US Treasury bond yields extended some support to the greenback.
The pair lost some additional ground following the disappointing release of UK construction PMI, which fell to 48.6 in May as against 50.5 previous and added to Monday’s weaker UK manufacturing PMI.
Against the backdrop of persistent UK political and Brexit uncertainties, the weaker reading attracted some fresh selling around the British Pound and further collaborated to the pair’s intraday pullback.
Moving ahead, Tuesday’s scheduled speech by the Fed Chair Jerome Powell might contribute towards producing some fresh trading opportunities later during the early North-American session.
Technical levels to watch
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