GBP/USD technical analysis: Drops to 2-week lows, now seems poised to test sub-1.2300 levels

• On offers for the second consecutive session amid UK political uncertainties.
• Break below 1.2340 confluence supports sets the stage for further weakness.

The GBP/USD pair failed to capitalize on its early uptick to the 1.2380 region and has now drifted into the negative territory for the second consecutive session, also marking its fourth day of a negative move in the previous five.
 
Given this week's rejection near the key 1.2500 psychological mark, the overnight sharp intraday fall of around 150 pips now seems to suggest the emergence of fresh selling pressure and support prospects for additional weakness.
 
The pair has now slipped below the overnight swing lows, coinciding with confluence support comprising of 200-period EMA on the 4-hourly chart and 38.2% Fibo. level of the 1.1958-1.2583 recent strong bullish momentum.
 
This coupled with the fact that technical indicators on the daily chart have just drifted into the negative territory further reinforce the near-term bearish outlook amid the ongoing Brexit saga/UK political uncertainty.
 
However, oscillators on the 1-hourly chart are already flashing slightly oversold conditions and are on the verge of dropping into the oversold zone, warranting caution for traders before initiating any aggressive bearish positions.
 
Meanwhile, a follow-through selling will set the stage for an extension of the pair's recent pullback from two-month tops and accelerate the slide further towards the 1.2300 handle en-route 50% Fibo. level support near the 1.2275-70 region.

GBP/USD 4-hourly chart