GBP/USD hits 3-week tops, inching closer to 1.35 mark

   •  USD languishes near multi-week lows and remains supportive.
   •  Some cross-driven strength lends an additional support. 
   •  Pre-holiday thin liquidity conditions could aggravate the move.

The GBP/USD pair continued gaining positive traction through the early European session and touched a three-week high level of 1.3472 in the last hour.

Persistent US Dollar selling bias amid subdued US Treasury bond yields remained supportive of the pair's bullish stance for the fourth consecutive session. As Tomasz Wisniewki, Chief Analysts at Alpari Research & Analysis Ltd writes: "The pair is in the uptrend since the beginning of the year. We are making significant higher lows and higher highs and bearish corrections are usually quite technical."

Meanwhile, today's up-move could also be attributed to some cross-driven strength, with the EUR/GBP cross witnessing a modest retracement from a six-day-old trading range barrier ahead of the 0.8900 handle.

There aren't any macroeconomic releases due on Friday and hence, the USD price dynamics would continue to act as an exclusive driver of the pair's momentum on the last trading day of the year.

Technical levels to watch

A follow-through buying interest has the potential to continue lifting the pair towards its next major resistance near the key 1.35 psychological mar, above which the pair seems all set to aim towards retesting monthly highs resistance near mid-1.3500s.

On the flip side, 1.3445-40 area seems to protect the immediate downside, which if broken could prompt some additional profit-taking slide back towards the 1.3400-1.3390 strong horizontal resistance break-point, now turned support.