GBP/USD hits fresh session low, now eyeing 1.2300 handle

The GBP/USD pair came under renewed selling pressure during early European session and has now dropped to a fresh session low.

Currently trading around 1.2335-40 region, the pair failed to benefit from a broad based greenback retracement and reversed all of its early tepid recovery gains to session peak near 1.2385 region. The US Dollar pared some of its early profit taking slide and attracted fresh selling pressure around the major. 

Recent USD price-action has been pointing to renewed buying interest on even the slightest of pull-back and is reinforcing strong underlying bullish tone on growing expectations of faster Fed rate-tightening cycle in 2017. Hence, focus now shifts to Thursday's key macro releases from the US, including final print of the Q3 GDP print and the Fed's preferred inflation gauge - core PCE price index. 

In the meantime, today's release of UK public sector net borrowing and existing home sales data from the US might provide some short-term trading impetus. 

Technical levels to watch

A follow through selling pressure below 1.2315-10 area (yesterday's low) is likely to accelerate the slide towards 1.2240-35 horizontal support before the pair eventually drops to test 1.2200 round figure mark. On the upside, any recovery momentum beyond session peak level near 1.2380-85 zone might now confront strong resistance at 50-day SMA near 1.2420 region, which if cleared should assist the pair back towards 1.2500 important psychological mark resistance.