GBP/USD firmer, 1.3100 – a whisker away

A fresh bout of selling interest seen in the US dollar across the board, bolstered the ongoing recovery in the GBP/USD pair in wake of a risk-on rally in the Asian equities.

GBP/USD rallies more than 100-pips

Currently, GBP/USD now rises 0.70% to 1.3080, quickly fading a spike to fresh five day highs printed at 1.3086. The cable’s recovery from thirty-one year troughs found extra legs in the Asian session this Tuesday, after the greenback was suddenly sold-off against its major peers in response to the decline in the shorter duration treasury yields. The 2-year yields slumped -1.21% to now trade around 0.650%.

The GBP/USD pair extends its bullish momentum into a third day today, correcting a minor portion of last week’s heavy sell-off as we head towards a hearing of the Treasury Committee at parliament, with the Bank of England (BoE) Governor Mark Carney and other FPC members likely to testify on the inflation outlook.

Meanwhile, markets also brace for a string of Fed speaks amid a data-quiet NA session ahead, with the only JOLTS job openings data on the cards for today.

GBP/USD Levels to consider

The pair has an immediate resistance at 1.3100 (psychological levels), above which 1.3118 (daily R2) would be tested. On the flip side, support is seen at 1.3066 (10-DMA) below that at 1.2975 (5-DMA).