GBP/USD regains 1.2900 in Asia, 1.2940 back on sight?

The latest opinion poll-driven rally in GBP/USD lost legs near 1.2940 region, triggering a fresh sell-off in the spot, which extended into the Asian opening trades. However, the Asian traders rescued the GBP bulls, driving the rate back beyond 1.29 handle, despite widespread risk-aversion.

GBP/USD: Upside limited amid UK election jitters?

The major is seen flirting with daily tops near 1.2925 levels, as broad based US dollar weakness helps the rebound, while tumbling treasury yields amid dwindling bets of further rate increases this year, following last week’s NFP disappointment, boost the demand for the pound as an alternative higher yielding asset.

On Monday, cable caught a sudden bid-wave and rallied hard, following the release of the latest ICM opinion poll results on the UK election. The ICM Poll showed that the UK PM May’s Conservatives are seen as the front-runners, with the lead expanding to 11 points against Labour.

Looking ahead, it remains to be whether the spot can extend the renewed uptick beyond Monday’s high of 1.2942, as a profit-taking rally in the GBP could continue, after the recent drop to six-week lows of 1.2767. Meanwhile, investors gear up for the big risk event for the coming months, the June 8 UK election.

In the meantime, the major may receive some impetus from the US JOLTS job openings and IBD/TIPP Economic Optimism data due later in the day.

GBP/USD Levels to consider            

Valeria Bednarik, Chief Analyst at FXStreet noted: “The pair presents a limited upward potential, despite the overall positive stance of technical indicators, as the price stands well above a modestly bullish 20 SMA, while technical indicators turned lower within positive territory.  Beyond 1.2950, the pair can extend its advance towards the 1.3000, where selling interest will likely contained the advance. Support levels: 1.2885 1.2840 1.2800 Resistance levels: 1.2920 1.2950 1.3000.”