“¢ The USD stalls corrective slide amid a renewed pickup in the US bond yields.
“¢ Cautious mood benefits USD’s safe-haven demand against GBP.
“¢ Traders eye second-tier US economic data for some short-term opportunities.
The GBP/USD pair trimmed some of its early strong gains and quickly retreated around 30-pips from fresh weekly tops.
The pair’s latest leg of downtick over the past hour or so lacked any obvious catalyst and could be solely attributed to a modest US Dollar rebound, supported by a goodish pickup in the US Treasury bond yields.
This coupled with comments by St Louis Fed president James Bullard, saying that the US economy is doing quite well further eased bearish pressure surrounding the buck that has been prevalent since Wednesday.
Meanwhile, a negative trading sentiment around European equity markets further supported the greenback’s safe-haven appeal against its British counterpart and further collaborated to the pair’s retracement from highs.
It, however, remains to be seen if the pair is able to find some fresh buying interest or the current retracement marks the end of a corrective bounce from near-term oversold conditions.
Next on tap would be the release of second-tier US economic data – personal income/spending data, core PCE price index, the usual initial weekly jobless claims and Chicago PMI, which will be looked upon to grab some short-term trading opportunities.
Technical levels to watch
The 1.3300 handle is likely to act as an immediate support, which if broken could drag the pair back towards testing the 1.3245 horizontal support before the downslide eventually gets extended back towards the 1.3200 round figure mark.
On the flip side, 1.3340-45 area might continue to act as an immediate resistance, above which the pair is likely to aim towards reclaiming the 1.3400 handle with some intermediate hurdle near the 1.3375-80 zone.
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