GBP/USD fades an uptick to 1.3375, UK data on tap

• Rejected at hourly 200-SMA at 1.3375
• USTs resume poise
• UK public sector net borrowing data – Up next.

Having run into stiff resistance located at hourly 200-SMA last hour, the GBP/USD pair drifted slightly lower, now consolidating the offers near 5-DMA of 1.3363 levels.

GBP/USD: Bears back in control

Volatility appears to have seeped back into the markets, as the European traders hit their desks and reacted to the latest remarks from the EU’s Chief Brexit coordinator Barnier, advocating a case for a Brexit transition period. The comments offered the much-need respite to the GBP bulls, prompting the spot to stage a solid comeback from a dip to 1.3352 levels.

However, the renewed bounce in Cable quickly fizzled out, as Treasury yields resumed its upward momentum across the curve, dampening the demand for the GBP as an alternative higher yielding currency. The 10-year Treasury yields stalled it correctively slide and rebounded sharply to hit fresh nine-month tops at 2.504%.

Meanwhile, with the UK’s consumer confidence dipping to a four-year low and looming Brexit uncertainty, the spot is likely to remain defensive ahead of the US final GDP,  Philly Fed manufacturing gauge and weekly jobless claims data.

GBP/USD Technical Levels

According to Haresh Menghani, Analyst at FXStreet, “Technically, the pair is retracing from a short-term descending trend-line resistance and could head back towards challenging the 1.3300 strong support. A convincing break below the mentioned handle is likely to accelerate the fall towards 50-day SMA, currently near the 1.3275-70 area, en-route a very important confluence support around the 1.3200 handle. On the flip side, any up-move might continue to confront fresh supply near the descending trend-line hurdle, currently near the 1.3400 handle, above which a bout of short-covering is likely to lift the pair towards 1.3470 intermediate resistance.”