GBP/USD fades a spike to 1.2800 neighborhood, stays under pressure around mid-1.2700s

   “¢   Irish PM Varadkar’s comments did provide a minor/short-lived lift to the GBP.
   “¢   Further gains remain capped amid modest USD rebound/rising US bond yields.
   “¢   Focus remains on the upcoming UK parliament debate on PM May’s Brexit deal.

The GBP/USD faded a bullish spike to the 1.2800 neighborhood and quickly retreated around 50-pips to refresh session low in the last hour.

The pair struggled to build on its strong recovery move from the post-flash-crash swing low to sub-1.2400 level, the weakest since April 2017, and for now, seems to have snapped three consecutive days of winning streak amid a modest US Dollar rebound.  

With investors looking past yesterday’s disappointing US ISM non-manufacturing index, a goodish pickup in the US Treasury bond yields helped revive the USD demand and was seen as one of the key factors exerting some downward pressure.

The pair did get a minor lift after Irish PM Varadkar said that the EU is willing to give fresh, written assurances about the nature of the Northern Ireland backstop to help the UK PM Theresa May get her Brexit deal through the UK parliament.  

However, investors now seemed reluctant to place any bullish bets, rather preferred to lighten their positions ahead of the UK parliament debate on the PM May’s Brexit deal, set to resume this Wednesday, and a meaningful vote scheduled next week.

In the meantime, any incoming Brexit-related headlines and the broader market sentiment surrounding the USD might continue to act as key determinants of the pair’s momentum amid absent relevant market moving economic releases, either from the UK or the US.

Technical levels to watch