GBP/USD recovers lost ground, jumps to fresh session peak

After an initial drop to 1.2323 level, the GBP/USD pair managed to recover the lost ground and has now jumped to a fresh session peak. 

Currently trading around 1.2385 region, the pair continues to find some buying interest around 1.2320 region marking 23.6% Fibonacci retracement level of 1.3439-1.1980 recent downslide. A mild greenback retracement, with the US Dollar Index correcting from Tuesday's 14-year peak, further assisted the pair to defend monthly lows support.

In absence of any fresh fundamental trigger, the latest leg of recovery could be attributed to short-covering after bears repeated failed to drag the pair below 1.2300 handle, held since early November. 

Moving ahead, today's US economic docket, featuring the release of existing homes sales for November, might provide fresh impetus ahead of Thursday's key GDP data from UK and the US.

Technical levels to watch

Immediate resistance on the upside is pegged at 1.2400 handle above which the pair is likely to aim towards 50-day SMA resistance near 1.2420 region. On the downside, weakness back below 1.2360 level might continue to find support near 1.2320 region, which if broken would expose 1.2270-80 support, en-route 1.2240 level.