• Pound fails to hold above 1.3300 versus US dollar.
  • Market sentiment deteriorates during the American session.
  • GBP/USD heads for lowest daily close since December 2020.

The GBP/USD turned to the downside after hitting a daily high at 1.3363 and dropped to 1.3295, reaching a fresh daily low. It then bounced back above 1.3300 but remains under pressure.

The US dollar gained momentum during the American session as the recovery in equity markets lost strength. Main stock indices in Wall Street remain in sportive territory but far from the highs. The Dow Jones gains just 0.10%.

Treasury yields are pulling back from daily highs as market sentiment deteriorates. The slide in US yields could limit the advance of the US dollar versus major European currencies. The 10-year yield fell from 1.56% to 1.52% during the last hour. Still, GBP/USD is headed toward the lowest daily close in almost a year.

Short-term outlook

A daily close below 1.3300 suggests more losses ahead for the pound in line with the dominant trend. The next support stands at 1.3270. The negative tone remains intact after cable was unable to hold above 1.3350.

If GBP/USD manages to rise back above 1.3350 and posts a daily close clearly above 1.3370, it would alleviate the bearish pressure. The next resistance stands at 1.3390 followed by 1.3415.

Technical levels

This article was originally published by Fxstreet.com.Read the original article here.


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