GBP/USD makes a solid comeback amid fresh USD selling

The bulls fought back control over the last hour, fuelling a solid rebound in GBP/USD back towards 1.22 handle in wake of some aggressive selling seen in the US dollar across the board.

GBP/USD rebounds to test daily pivot at 1.2186?

Fresh bids emerged for cable once again near multi-month troughs, which sent the rate sharply almost 40-pips higher in minutes, as the selling pressure behind the greenback accelerated versus its main competitors amid weaker US treasury yields.

Markets are seen unwinding the USD longs created after the release of upbeat US wage price growth figures seen last Friday. While some short-covering on the GBP shorts after yesterday’s massive slide cannot be ruled.

On Monday, the pound slumped sharply across the board after the UK PM May’s comments signaled a hard-Brexit landing, which brought Brexit-related anxiety back into the markets.

Meanwhile, the major will get influenced by the broad market sentiment and USD dynamics in absence of relevant macro updates due on the cards today, except for the US JOLTS job openings data.

GBP/USD Levels to consider            

In terms of technical levels, upside barriers are lined up at 1.2200 (round figure), 1.2260 (5-DMA) and 1.2294 (20-DMA). While supports are seen at 1.2150 (psychological levels) and 1.2125 (multi-week lows) and below that at 1.2100 (key support).