GBP/USD weaker, struggling to retake 1.2300 ad above

The selling bias around the Sterling is picking up extra pace today, sending GBP/USD to test fresh 6-week lows in the 1.2280 area albeit finding some bids afterwards.

GBP/USD attention to US data

The pair is following south the rest of the risk-associated assets against the backdrop of a better sentiment around the buck.

Supportive Fedspeak has given extra wings to market expectations of a Fed rate hike at its meeting later in the month, sustaining the sharp move in US yields and in turn bolstering the up move in the greenback. New York Fed W.Dudley (permanent voter, centrist) said on Tuesday that the case for further (Fed) tightening is ‘compelling’, adding to the recent views by FOMC’s Kaplan and Harker.

According to CME Group’s Fedwatch tool, the probability of higher rates this month have climbed to nearly 70%, up from just above 30% the previous day.

Data wise, Markit’s Manufacturing PMI came at 54.2 for the month of February while the more relevant ISM Manufacturing surpassed estimates at 57.7 during the same period.

GBP/USD levels to consider

As of writing the pair is losing 0.60% at 1.2306 and a break below 1.2281 (low Mar.1) would aim for 1.2250 (low Jan.19) and finally 1.1979 (2017 low Jan.19). On the flip side, the initial up barrier aligns at 1.2410 (100-day sma) followed by 1.2474 (20-day sma) and then 1.2572 (high Feb.24).