GBP/USD flirting with daily highs in the mid-1.2600s

The selling bias around the buck is helping GBP/USD to advance to he area of session tops in the 1.2650/60 band on Thursday.

GBP/USD deflates from 2-month tops

The pair is managing to post gains after two consecutive pullbacks following the rejection from fresh 2-month peaks near 1.2780 earlier in the week, as fundamentals for a more sustainable upside remains absent for the time being.

Poor UK data as of late plus an erratic performance of the greenback has been also supporting the choppy trade around spot in past sessions, although fears among investors of the likeliness of a ‘hard Brexit’ seem somewhat alleviated, underpinning GBP and limiting the downside at the same time.

As Senior FX Strategist at Rabobank Jane Foley puts it: “We see risk for GBP/USD dipping back to the 1.24 area on a 3 mth view in recognition of the political uncertainty that still clouds the UK. In the absence of further signs that the UK could retain access to the EU’s single market post Brexit, we would argue that a recovery to the 1.30 area still looks to be a long way away”.

GBP/USD levels to consider

As of writing the pair is gaining 0.20% at 1.2651 and a break above 1.2776 (high Dec.6) would open the door to 1.2784 (100-day sma) and then 1.2862 (high Oct.4). On the flip side, the immediate support aligns at 1.2623 (low Dec.5) ahead of 1.2522 (20-day sma) and then 1.2485 (55-day sma).