GBP/USD consolidates strong gains to over 3-month tops

   •  Traders looked past today's softer UK PMI print.
   •  Surging US bond yields fail to revive USD demand.

The GBP/USD pair now seems to have entered a bullish consolidation phase and was seen oscillating within 25-30 pips narrow trading range.

Currently holding with strong gains near 3-month tops, just above mid-1.3500s, the pair extended last week's bullish break through a short-term descending trend-line resistance and was further supported by the prevailing strong bearish sentiment surrounding the US Dollar. 

Even today's disappointing UK manufacturing PMI print, coming in at 56.3 for December as against a reading of 58.0 expected and down from November's 58.2, also did little to attract any fresh selling pressure at higher levels, albeit failed to provide any additional boost. 

Adding to this, a sharp rebound in the US Treasury bond yields, which although has failed to revive USD demand, might now contribute towards keeping a lid on any additional up-move, at least for the time being.

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes, “the short-term picture is bullish, as the price is well above a bullish 20 SMA, while technical indicators regained the upside, the Momentum barely and within positive territory, but the RSI accelerating north around 78. The pair has room to extend its advance toward the 1.3600/10 region, with a break above the level exposing 1.3653, last year's high. The immediate support, on the other hand, is the 1.3520 price zone, followed by Friday's low of 1.3495, level that, if reached, will likely attract buying interest.”