GBP/USD off-highs, but stays above 1.2500 ahead of UK PMI

The GBP/USD pair stalled its ongoing recovery just shy of 1.2550 levels, sending the rate sharply lower to test daily lows reached just ahead of 1.25 handle, before finding fresh bids near the last.

GBP/USD bounces-off 1.2500

The cable retreats from highs, but manages to remain better bid above 1.25 barrier amid a minor correction seen in the US dollar against its major peers, after the buck witnessed an extensive risk-on rally following a 9% surge in oil prices, in wake of the OPEC output cut agreement.

Moreover, strong gains seen in the Asian equities also refuel risk-on trades, boosting the risk currency in GBP.  While markets also continue to cheer yesterday’s upbeat talks from BOE Governor Carney, following the release of BOE’s Financial Stability Report (FSR).

All eyes now remain on the UK manufacturing PMI report due for release ahead of US unemployment claims and ISM manufacturing data, which will be published in the American session. Meanwhile, oil-driven broader market sentiment will continue to influence the spot.

GBP/USD Levels to consider            

In terms of technical levels, upside barriers are lined up at 1.2550 (psychological levels), 1.2585 (Nov 10 high) and 1.2614 (Nov 14 high). While supports are seen at 1.2482 (5-DMA/ daily pivot) and 1.2369/65 (10 & 20-DMA) and below that at 1.2416 (Nov 30 low).