- GBP/USD witnessed a modest pullback from YTD tops set earlier this Monday.
- The downtick lacked any obvious catalyst and was solely led by profit-taking.
- Any meaningful dips might still be seen as an opportunity for bullish traders.
The GBP/USD pair extended its steady intraday pullback and refreshed daily lows, around the 1.3300 mark during the early European session.
The pair failed to capitalize on its early uptick, instead witnessed a modest pullback from to the 1.3370 region, or the highest level since December 16, 2019. The downtick lacked any obvious fundamental catalyst and could be solely attributed to some profit-taking.
Meanwhile, the downside seemed limited, at least for now, amid a subdued US dollar price action. The Fed Chair Jerome Powell’s dovish signals at the Jackson Hole Symposium on Thursday kept the USD bulls on the defensive through the first half of the trading action on Monday.
This coupled with a weaker tone surrounding the US Treasury bond yields and the upbeat market mood further undermined the greenback. The global risk sentiment got an additional boost following the release of upbeat Chinese Manufacturing and Services prints for August.
Given that the GBP bulls have largely shrugged off concerns about the lack of progress in the Brexit talks, the near-term bias remains tilted in favour of bullish traders. Hence, any meaningful dip might still be seen as an opportunity for bullish traders.
The UK markets are closed in observance of the Summer Bank Holiday. In the absence of any major market-moving economic releases from the US, the USD price dynamics might continue to act as an exclusive driver of the GBP/USD pair’s intraday momentum on Monday.
Technical levels to watch
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