GBP/USD jumps to test 1.3000, focus on cross-party Brexit talks

• Stalled USD bounce rescues the bulls from 6-month troughs.
• Technical set up favors the bulls in near-term.
• Cross-party Brexit talks, US data in focus.

Fresh bids emerged once again near the six-week lows of 1.2975, prompting a tepid bounce in the GBP/USD pair to the 1.30 handle. But the bulls appear to lack follow-through, awaiting fresh Brexit-related developments, as the UK cross-party talks resume while the UK Parliament reconvenes after a week-long Easter recess.

The renewed uptick in the spot can be mainly attributed to a pause in the US dollar recovery across its main competitors, as negative Treasury yields and US equity futures amid softer risk tones, in the wake of ongoing US-Iran geopolitical tensions, continue to cap the upside in the greenback.

Moreover, the technical picture also turned bullish in the near-term after the GBP/USD pair broke higher out the descending broadening channel on the hourly sticks earlier today. Hence, a test of the next resistance at 1.3030 is likely, as the pair has taken-out the key 50-day SMA hurdle located at 1.2991.

However, it remains to be seen if the pair can sustain the upside amid the British political uncertainty, especially after a senior Tory lawmaker was said to be plotting to oust the PM May. This report sent GBP/USD down to six-week lows of 1.2975 a day before.

Looking ahead, “there are no events scheduled on the UK calendar, leaving the focus on  Brexit. In the US, New Home Sales are  forecast  to slide in March from the annualized level of 667K in February. Existing Home Sales, Building Permits, and Housing Starts all fell short of expectations. All in all, politics are set to dominate”, FXStreet’s Senior Analyst, Yohay Elam, notes.

GBP/USD Technical Levels