“¢ UK PM May’s Brexit comments exerted some downward pressure.
“¢ A subdued USD demand helped quickly reverse a modest downtick.
“¢ Upbeat ADP report does little to revive USD demand and remains supportive.
The GBP/USD pair quickly reversed a mid-European session dip, albeit seemed struggling to move back the key 1.30 psychological mark.
The UK PM Theresa May‘s comments at the Conservative Party’s Conference, saying that Britain is not afraid to leave with no deal, exerted some downward pressure on the British Pound. This, against the backdrop of a slight disappointment from the UK services PMI print, dragged the pair to an intraday low level of 1.2963.
The downtick, however, turned out to be short-lived, with the pair quickly bouncing around 25-30 pips from daily lows amid a subdued US Dollar price action. Even the upbeat release of the ADP report, which showed that the US private sector employers added 230K new jobs in September, did little to revive the USD demand.
Further gains, however, remained capped as market participants now look forward to the release of ISM non-manufacturing PMI for some fresh impetus. This coupled with any fresh Brexit-related news/headlines might continue to infuse volatility across the GBP pairs.
Technical levels to watch
Any meaningful up-move beyond the 1.30 handle is likely to confront stiff resistance near the 1.3035-40 horizontal zone, above which the pair is likely to aim towards reclaiming the 1.3100 round figure mark. On the flip side, immediate support is pegged near the 1.2950-40 region, which if broken is likely to accelerate the fall towards the 1.2900 round figure mark.
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