GBP/USD falls back to 200-DMA support in pre-NFP action
• Renewed USD strength prompts some fresh selling.
• Bears await a decisive breakthrough 200-DMA support.
• Focus remains on the keenly watched US NFP report.
The GBP/USD pair finally broke down of its Asian session consolidation phase and dropped to fresh session lows in the last hour.
The pair struggled to build on overnight modest recovery bounce from the very important 200-day SMA and remained capped below the 1.3600 handle amid re-emerging Brexit concerns, with some renewed US Dollar buying interest prompting some fresh weakness during the early European session.
Meanwhile, some repositioning trade, ahead of today's important data risk, could also be one of the factors behind the pair's sudden fall of around 35-40 pips over the past hour or so.
Traders, however, are likely to wait for the release of the keenly watched US monthly jobs report (NFP) before initiating any fresh bearish positions. Hence, the downfall seems more likely to stall at the 200-DMA support near the 1.3535 region.
Technical levels to watch
Weakness below the mentioned support would indicate a fresh bearish breakdown and accelerate the slide towards the key 1.3500 psychological mark before the pair eventually drops to YTD lows near the 1.3460-55 region.
On the flip side, any meaningful recovery attempts might continue to face some fresh supply near the 1.3600 handle, which if cleared might trigger a short-covering bounce towards the 1.3700 handle with some intermediate resistance near the 1.3655 area.