GBP/USD: popping higher in Tokyo to 1.3271

Currently, GBP/USD is trading at 1.3267, up 0.23% on the day, having posted a daily high at 1.3272 and low at 1.3235.

After dropping from 1.3287 in Asia to 1.3222 the low for European trade, cable was ending the NY session at 1.3240.

Market wrap: US dollar and US bond yields consolidated - Westpac

 It seems that Sterling has peaked and formed a top on the back higher UK rate outlook which is now unwinding. There is essentially weak UK growth being spoken on the street on the back of recent disappointments amongst rising inflation, Brexit & political uncertainty all weighing on the bulls for now. The Construction PMI fell below the 50 line for the first time in more than a year to 48.1 in September from 51.1. On Monday, the Manufacturing PMI showed lower-than-expected numbers. 

GBP/USD levels

“Technically, the bearish momentum decelerated according to readings in the 4 hours chart, but the downward risk persists, as indicators are consolidating within overbought territory, whilst the 20 SMA extended its decline above the current level, now converging with the 61.8% retracement of the latest bullish run, at 1.3340,” said Valeria Bednarik, Chief Analyst at FXStreet. According to Valeria, a break below 1.3220, will likely result in a full retracement, with the pair falling down to 1.3146 (Sep 14 low).