GBP/USD heavy, flirts with 1.3000

The GBP/USD pair witnessed volatile moves during the European hours, initially breaking the consolidation phase to the upside, although failed to sustain the upmove and fell sharply lower to test 1.3000 levels.

GBP/USD defending 1.30 barrier?

Currently, GBP/USD drops -0.20% to 1.3002, testing 1.3000 – key psychological barrier. Having faced rejection ahead of 5-DMA at 1.3058, the cable extends sell-off on the back of aggressive selling seen in the UK Gilt yields, with the benchmark 10-year yields sliding almost 4% to 0.845.

Going forward, focus will remain on the US datasets ahead of the policy decisions from the BOJ and Fed, which are likely to have a significant impact on the fx pairs across the board.

GBP/USD Levels to consider            

The pair has an immediate resistance at 1.3089/93 (Aug 17 & Sept 19 high), above which 1.3140 (daily R2) would be tested. On the flip side, support is seen at 1.2981 (daily S1) below that at 1.2950 (psychological levels).