GBP/USD clings to recovery gains above 1.2250 level

The GBP/USD pair staged a goodish recovery from two-month lows and reversed majority of its losses recorded in the previous session. 

Currently trading around 1.2260 region, the US Dollar retreated across the board, in wake of yesterday's disappointing pending home sales data, and has been the sole driver of the pair's recovery on Thursday. 

Despite of today's recovery move, 1.2300 mark remains elusive for the pair as renewed 'hard Brexit' worries might continue to weigh on investor sentiment and restrict any further recovery. Moreover, with no major economic releases due until next week, diverging monetary policy stance between the Federal Reserve and other major central banks should continue to lend support to the US Dollar and contribute towards limiting additional recovery for the major. 

In the meantime, today's US economic docket featuring the release of weekly jobless claims and goods trade balance data might help traders to grab some short-term trading opportunities. 

Technical levels to watch

From current levels, 1.2275 level is likely to act as immediate resistance but 1.2300 handle remains major upside hurdle, which if conquered is likely to lift the pair beyond 1.2325-30 horizontal resistance towards reclaiming 1.2400 handle.

On the downside, weakness back below 1.2225-20 now becomes immediate support below which the pair is likely to drift back towards 1.2200 handle. A convincing break below 1.2200 handle is likely to accelerate the slide towards 1.2160 intermediate support before the pair eventually drops to test its next major support near 1.2100 round figure mark.