GBP/USD meets fresh supply, down to test 10-DMA

Having witnessed a brief consolidative phase below 1.2350 levels in early trades, the GBP/USD pair finally broke to the downside amid pick-up in generalized demand for the greenback and rebound in the European equities, as risk sentiment improved on upbeat Eurozone PMI reports.        

However, the downside appear capped in cable as fresh selling seen in the EUR/GBP cross lends support to the GBP somewhat. Looking ahead, the major will closely watch out RO-RO trends for fresh incentives as both the UK and US markets are closed in observance of New-Year’s holiday.

While attention now turns towards the UK manufacturing PMI and US ISM manufacturing reports due on the cards tomorrow for further impetus.

GBP/USD Levels to consider            

In terms of technical levels, upside barriers are lined up at 1.2355 (daily R1), 1.2389 (weekly high) and 1.2400 (round figure). While supports are seen at 1.2296 (10-DMA) and 1.2242 (Dec 30 low) and below that at 1.2200 (zero figure).