GBP/USD climbs further beyond mid-1.2800s, highest since March 11

• GBP/USD gains traction for the seventh straight session amid sustained USD selling bias.
• Bulls largely shrugged off renewed fears of a no-deal Brexit, worsening US-China relations.
• Monday’s US Durable Goods Orders will now be looked upon for some trading impetus.

The heavily offered tone surrounding the greenback lifted the GBP/USD pair to near five-month tops, around the 1.2875 region during the mid-European session on Monday.

The US dollar kicked off the new week on a downbeat note amid worries that the economic recovery in the US could be grinding to a halt in the wake of the resurgence in coronavirus cases. This, in turn, assisted the GBP/USD pair to capitalize on last week’s strong positive move and continue gaining traction for the seventh consecutive session.

This coupled with concerns about worsening US-China relations fueled speculations that the Fed would add more stimulus for a longer period of time and in bigger quantities to support the economy. This was evident from the ongoing downfall in the US Treasury bond yields, which exerted some additional downward pressure on the greenback.

With the USD price dynamics turning out to be an exclusive driver of the GBP/USD pair strong positive move to the highest level since March 11, bulls largely shrugged off renewed fears of a no-deal Brexit. It is worth reporting that the latest round of negotiations ended last Thursday without any significant progress on the post-Brexit trade deal.

Both the UK and the EU said that talks remain at a stalemate and they were still some way off reaching an agreement. Britain’s chief Brexit negotiator David Frost said that they will not achieve the goal of striking a preliminary agreement by the UK Prime Minister Boris Johnson’s July deadline and the UK should be prepared for the possibility that a deal will not be reached.

Market participants now look forward to the US economic docket, highlighting the release of Durable Goods Orders. The data might influence the USD and produce some short-term trading opportunities. Meanwhile, overbought conditions on short-term charts might hold traders from placing fresh bullish bets and cap any additional gains for the GBP/USD pair.

Technical levels to watch