GBP/USD drops below 1.2900 handle, seems vulnerable below 1.2880-75

During early European trading session, the GBP/USD pair dropped to retest 1.2875-80 support before recovering few pips to currently trade around 1.2900-1.2890 band. 

The US Dollar remained firm after Friday's strong headline NFP print that surpassed even the most optimistic estimates, while the British Pound remained well offered on expectations of further monetary easing by the Bank of England. 

Market focus remains on this week's BoE monetary policy decision on Thursday where the central bank is expected to announce an interest rate-cut for the first time since 2009. Market participants also seem to price-in additional easing measures going ahead, which might now restrict any near-term recovery for the GBP/USD pair.

Technical levels to watch

On a sustained weakness below 1.2880-75 immediate support, the pair seems to head back towards post-Brexit swing lows support near 1.2800 round figure mark. On the upside, recovery now seems to confront immediate resistance near 1.2930 level ahead of 100-hourly SMA strong resistance near 1.2965-70 region.