GBP/USD drops below 1.300 handle after UK data

The GBP/USD pair erased all of its early gains to a 4-day high level of 1.3058 and extending its reversal, has now dropped below 1.3000 mark following the release of UK economic data.

The release of better-than-expected rise in UK consumer credit and net lending to individuals seems to have been negated by a higher-than-expected drop in mortgage approvals. 

Meanwhile, a broad based greenback recovery also contributed to the renewed selling pressure around the major as markets digest OPEC-deal led risk-on rally, which initially pulled the overall US Dollar Index lower.

Focus now shifts to US economic docket, which highlights the release of final US GDP print for Q2 2016 and would be looked upon to grab immediate momentum play. Thursday's economic calendar also features the release of weekly jobless claims and pending home sales data from the US.

Technical levels to watch

On a sustained weakness below 1.3000 psychological mark, and a subsequent break below Wednesday's low support near 1.2980, the pair is likely to accelerate the downslide towards testing a short-term ascending trend-line support near 1.2945-40 region. Meanwhile on the upside, 1.3050-55 region now becomes immediate strong hurdle, which if cleared should trigger a short-covering rally immediately towards 1.3085-90 resistance before the pair heads towards reclaiming 1.3100 handle.