GBP/USD refreshes session tops and retreats, back near 1.2800 mark ahead of UK PMI

   “¢   Broad-based USD weakness helped regain positive traction.
   “¢   Brexit uncertainties kept a lid on any runaway rally.
   “¢   Traders eye UK manufacturing PMI for some fresh impetus.

The GBP/USD pair spiked to a fresh intraday high level of 1.2825 during the early European session, albeit struggled to sustain at higher levels.

After an Asian session dip to 1.2730 area, the pair regained positive traction and built on its weekly bullish gap. Broad-based US Dollar weakness, led by the latest optimism over a truce between the world’s two largest economies, turned out to be one of the key factors driving the pair higher.

However, persistent Brexit uncertainties, coupled with reports that the UK PM Theresa May could face a no-confidence vote if parliament rejects the Brexit deal continued denting sentiment surrounding the British Pound and kept a lid on any runaway rally for the major.

Today’s release of UK manufacturing PMI for November seems unlikely to be a major game changer for the Sterling but would still be looked upon for some short-term impetus. Later during the early North-American session, the US ISM manufacturing PMI might further assist traders to grab some short-term opportunities.

Technical levels to watch

The 1.2780-75 region now seems to act as an immediate resistance, below which the pair is likely to head back towards challenging the 1.2730-25 support area before eventually breaking through the 1.2700 handle to retest yearly lows, around the 1.2665-60 region.

On the flip side, the 1.2820-30 region might continue to act as an immediate hurdle and is followed by the 1.2850 supply zone, which if cleared might trigger a short-covering bounce and assist the pair to aim towards reclaiming the 1.2900 handle.