GBP/USD struggles near daily lows, well below 1.2200 mark

• GBP/USD witnessed some follow-through selling for the third straight session on Friday.
• Weaker UK retail sales report, resurgent USD demand exerted some downward pressure.
• Concerns over worsening US-China relations underpinned the USD’s safe-haven demand.

The GBP/USD pair remained depressed through the early North American session and was last seen trading near the lower end of its daily trading range, around the 1.2180-75 region.

Following a brief consolidation through the early part of Friday’s trading action, the pair met with some fresh supply extended this week’s rejection slide from the vicinity of the 1.2300 mark or 50-day SMA barrier. Friday’s weaker-than-expected UK monthly retail sales report took its toll on the British pound.

This coupled with a goodish pickup in the US dollar demand further collaborated to the GBP/USD pair’s slide for the third consecutive session. Concerns about worsening US-China relations weighed on investors’ sentiment, which turned out to be one of the key factors that benefitted the greenback’s safe-haven status.

The USD bulls seemed rather unaffected by a stable opening in the US equity markets and even shrugged off a weaker tone surrounding the US Treasury bond yields. This comes amid rising bets for negative BoE interest rates, which might have already set the stage for the resumption of the GBP/USD pair’s prior downward trajectory.

However, it will be prudent to wait for some strong follow-through selling below mid-1.2100s to confirm a fresh bearish breakdown and positioning for a further near-term depreciating move.

Technical levels to watch