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  • GBP/USD pair failed to capitalize on its early uptick and drifts lower for the third straight session.
  • A sudden pickup in the USD demand was seen as a key trigger behind the sharp intraday downfall.

A fresh wave of the USD buying interest emerged during the early European session and dragged the GBP/USD pair to fresh session lows, around the 1.2430 region in the last hour.

The pair failed to capitalize on its early attempted recovery move to levels beyond the key 1.2500 psychological mark, instead met with some fresh supply and has now drifted back closer to weekly lows set in the previous session.

The pair’s sharp intraday slide of nearly 100 pips from the vicinity of the 1.2525 region was sponsored by resurgent US dollar demand following note of caution from Gilead Sciences on their antiviral drug remdesivir.

The remarks faded the latest optimism over the treatment for COVID-19 virus and provided a fresh lift to the greenback ‘s status as the global reserve currency amid persistent worries about the economic fallout from the pandemic.

It will now be interesting to see if the pair continues to find some support at lower levels or breaks through the 1.2400 round-figure mark, which will confirm that a near-term top is already in place and set the stage for further downside.

There isn’t any major market-moving economic data due for release, either from the UK or the US. Hence, developments surrounding the coronavirus saga might continue to play a key role in producing some meaningful trading opportunities.

Technical levels to watch