GBP/USD: Bulls rescued by upbeat UK PMI, recovers to 1.2900

The GBP/USD pair stages a solid comeback from three-month lows, and now swings higher in a bid to reclaim 1.29 handle.

GBP/USD cheers stronger UK PMI data

Fresh bids emerged near the mid-point of 1.28 handle following the release of surprisingly positive UK manufacturing PMI report, allowing a solid recovery in the cable back towards 1.2900 levels. At the time of writing, GBP/USD recovers to 1.2890, still down -0.68% on the day.

The final Purchasing Managers' Index (PMI) in the UK jumped to 55.4 points in Sept, as compared to a 53.3 reading booked in Aug. Markets had predicted a drop to 52.1.

The GBP/USD pair dropped almost 1% intraday today, after the Brexit process-related uncertainty took a toll on the pound. The UK will begin its procedure to exit the EU’s membership by March end next year, British PM May announced late-Sunday.

Focus now shifts towards the US ISM manufacturing sector report due later in the NA session. In the meantime, the major will continue to get influenced by the Brexit-related newsflow.

GBP/USD Levels to consider            

The pair has an immediate resistance at 1.2900 (key support-turned resistance), above which at 1.2955 (5-DMA) and next at 1.2980 (10-DMA). On the flip side, support is seen at 1.2846 (3-month low) below that at 1.2800/1.2796 (round figure/ Brexit-low) and at 1.2750 (30-year lows).