GBP/USD holding PMI-led strong gains to 1.3250 ahead of US ISM

The GBP/USD pair maintained its strong bid tone and is now building on to its break-out momentum above 1.3200 handle to currently trade around mid-1.3200s.

A surprisingly stronger-than-expected and sharp rebound UK manufacturing PMI lifted the British Pound sharply higher across the board. The GBP/USD pair surged through 50-day SMA for the first time in the post-Brexit regime and is now within striking distance of challenging multi-week high level of 1.3279 touched last week. 

Focus now shifts to the weekly release of jobless claims data from the US, which will be followed by the release of US ISM manufacturing PMI for the month of August. However, Friday's NFP release remains the key determinant of the Fed monetary policy stance and eventually for the greenback's near-term trajectory.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet, notes, "The price has broken above a flat 200 EMA once again, indicating market's will to take it higher. Above 1.3280, the next resistance is standing at 1.3320, the 23.6% retracement of the post-Brexit slump, and a major static resistance. Above this last, the rally can extend initially up to 1.3360, en route to 1.3410."

"The immediate support comes at 1.3210, and intraday buying interest is expected to surge around the level, although a break below it can see the pair returning to the 1.3160/80 price zone."