GBP/USD bounces off multi-week lows, back above 1.2150

The GBP/USD pair extended modest recovery move from nearly two-month lows and spiked beyond mid-1.2100s, albeit maintained its bearish bias through early NA session.

A mild retracement in the US treasury bond yield has failed to support the positive sentiment surrounding the US Dollar and helped the pair to bounce off 1.2100 neighborhood, touched during mid-European session. 

Meanwhile, news report (via the Independent) that the Queen will approve the government's Brexit bill in days, empowering the UK PM Theresa May to formally trigger Article 50 by end of March, also seems to have provided some respite for the British Pound, at least for the time being.

Moreover, possibilities of some bears taking some profits off the table, ahead of this week’s key event risks (FOMC & BoE), further collaborated to the pair’s sharp recovery move in the past hour or so.

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet notes, "the 1 hour chart shows that technical indicators have bounced from oversold readings, but quickly lost upward strength, whilst the 20 SMA has accelerated its decline above the current level, all of which favors additional declines. In the 4 hours chart, the price has settled below previous lows and a horizontal 20 SMA, while technical indicators head nowhere within bearish territory, not enough to confirm a bearish extension, but maintaining the risk towards the downside."