GBP/USD trims gains and retreats to the mid-1.2700s

• Cable gives away initial gains and recedes to the 1.2750 region.
• UK’s manufacturing PMI came in at 53.1 in November.
• Brexit negotiations to come to the fore later in the week.

After climbing to fresh highs beyond 1.2820, GBP/USD has now faded that initial optimism and is now navigating the mid-1.2700s, just clinging to its daily gains.

GBP/USD looks to Brexit, risk trends

Cable inched further north of the critical 1.2800 barrier during the Asian session on the back of an improved tone in the riskier assets, all after the positive outcome from the Trump-Xi meeting, where a 90-day truce in the US-China trade spat was clinched.

Back to the UK, all the attention will be of course on Brexit and the debate in the House of Commons starting tomorrow, while the key vote on PM May’s deal is expected a week later.

Later in the day, the US docket will be in centre stage where the ISM manufacturing will be the main release along with speeches by key FOMC members.

GBP/USD levels to consider

As of writing, the pair is up 0.02% at 1.2748 facing the next hurdle at 1.2825 (high Dec.3) seconded by 1.2883 (21-day SMA) and then 1.2928 (high Nov.22). On the other hand, a breach of 1.2724 (low Nov.15) would open the door to 1.2696 (low Oct.30) and finally 1.2662 (2018 low Aug.15).