GBP/USD hits fresh 3-week highs near 1.3370, US data eyed

The GBP/USD pair staged a solid recovery in the European session this Wednesday, now jumping back on the bids to reach fresh three-week tops.

GBP/USD fast approaching 1.3400?

Currently, GBP/USD trades +0.10% higher at fresh three-week highs of 1.3371, bouncing sharply from 1.3340 levels. The cable extends its bullish momentum into a second-day today, and now makes fresh headway towards 1.3400 levels on the back of stalled USD buying across the board.  Meanwhile, the USD index now trades +0.15% higher at 95.15 versus +0.23% seen previously.

The GBP/USD pair also found support from in line with expectations UK services PMI report and upbeat construction PMI data. While a short-covering rally ahead of Thursday’s much-awaited BOE rate decision also cannot be ruled out.

In the meantime, markets look forward to the US ADP non-farm employment data due to be published ahead of the ISM services PMI report later in NA session.

GBP/USD Levels to consider                           

The pair has an immediate resistance at 1.3400 (round number), above which 1.3450 (psychological levels) would be tested. On the flip side, support is seen at 1.3305 (Jul 29 high) below that at 1.3262 (5-DMA).