GBP/USD refreshes session lows, retreats nearly 100 pips from daily swing high

• GBP/USD failed to capitalize on its intraday bullish move back closer to two-week tops.
• Worsening US-China relations continued lending some support to the safe-haven USD.
• UK PM spokesman reiterated that the Brexit transition period will end on 31 December.

The GBP/USD pair retreated nearly 100 pips from the daily swing high and refreshed session lows, around mid-1.2100s in the last hour.

The emergence of some fresh US dollar selling during the early European session, triggered by a goodish pickup in the shared currency, assisted the GBP/USD pair to reverse an early dip and jump to an intraday high level of 1.2254.

However, concerns about a further escalation of diplomatic tensions between the United State and China continued lending some support to the greenback’s relative safe-haven status. This, in turn, kept a lid on any strong gains, instead prompted some fresh selling around the GBP/USD pair.

The intraday pullback picked up paced after the PM spokesman reiterated government’s position and said that the Brexit transition period will not be extended beyond December 31. The comments took its toll on the sterling and dragged the GBP/USD pair to fresh session lows in the last hour.

Meanwhile, investors seemed to have digested the overnight report that the EU is willing to drop its ‘maximalist’ approach on fisheries in the next round of Brexit negotiations with the UK, starting next week. Hence, it will now be interesting to see if the pair is able to find any support at lower levels or continues with its intraday downfall amid absent relevant market moving economic releases.

Technical levels to watch