GBP/USD analysis: back to 1.3300 as Brexit comes under the spotlight

Valeria Bednarik FXStreet

GBP/USD Current price: 1.3307

UK May Markit services PMI expected at 53.0 from the previous 52.8.
Brexit talks to resume in Brussels, eyes of future trade relationship and Irish border issues.

The GBP/USD pair surged to 13397 in the first trading day of the week, level last seen on May 24th, backed by a positive UK release. The UK Construction PMI came in at 52.5 in May, unchanged from April's reading and posting a modest pickup that indicates that the sector's growth remains subdued, according to the official Markit release. New business growth slipped into decline, amid uncertainty towards the outlook. The Markit May Services PMI will be out this Tuesday, expected at 53.0 from the previous 52.8. In the meantime, Brexit talks will resume this week with no clear solutions yet on the Irish border issue and post-Brexit custom life. Also, the Brexit withdrawal bill would return to the House of Commons on June 12. The GBP/USD pair 4 hours' chart presents a neutral stance heading into the Asian session, as the pair is now struggling around a flat 20 SMA, while technical indicators have pulled back from near overbought readings, the Momentum now heading nowhere around its 100 level, but the RSI maintaining the downward slope at 46, leaning the scale toward the downside for the upcoming sessions.

Support levels: 1.3290 1.3245 1.3200

Resistance levels: 1.3375 1.3420 1.3460

View Live Chart for the GBP/USD

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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