GBP/USD extends UK PMI-led up-move further beyond 1.29 handle

Having dropped to multi-day lows near 1.2865 region, the GBP/USD pair regained traction and built on to its momentum back above the 1.2900 handle.

Currently trading around 1.2920-25 region, testing session peaks, the pair continues to benefit from today's surprisingly stronger-than-expected UK manufacturing PMI print, coming-in at 57.3 for April as compared to last month's 54.2 and 54.0 expected. 

Meanwhile, a softer tone surrounding the broader US Dollar Index, despite of a modest up-tick in the US treasury bond yields, also helped the pair to reverse majority of its previous session's losses led by renewed worries over a possible 'hard Brexit' scenario. 

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There are no macroeconomic releases due from the US on Tuesday and hence, repositioning trade ahead of this week's key event risks - FOMC meeting and monthly jobs report (NFP) from the US, might continue to fuel some volatile price-action ahead of the UK Construction PMI release during European session on Wednesday. 

Technical outlook

Valeria Bednarik, Chief Analyst at FXStreet writes: "Above 1.2920, the pair has room to advance up to 1.2964, the multi-month high posted last week, while beyond the level, the rally could extend quickly up to 1.3000."

"Below 1.2830, however, the risk turns towards the downside, with room for an extension down to 1.2770 today" she added.