GBP/USD pares majority of daily gains, drops to 1.3030

As the US trading session gets underway, the GBP/USD pair lost its upside momentum and reversed majority of its gains to 1.3100 neighborhood to currently trade around 1.3030 region. 

After heavy USD selling on diminishing prospects of an imminent Fed rate-hike action, the pair's recovery from 4-week low touched on Tuesday ran into fresh offers around 1.3100 handle. 

Investors seem to have utilized the bounce-back in the major as selling opportunity on speculations of further monetary easing by the Bank of England after BOE's Ian McCafferty suggested that the central bank could cut rates further if the economy declines. 

From technical perspective, the pair retested early Asian session highs and has reversed sharply, which now seems to constitute towards formation of a bearish double-top chart pattern on 1-hourly chart. The patter would be confirmed once the pair decisively breaks below 1.3020 immediate support.

Technical levels to watch

On a sustained break below 1.3020 support, the pair seems to immediately break below 1.3000 psychological mark and head back towards testing 1.2970-60 strong support. A follow through selling pressure below Tuesday's swing lows support might continue dragging the pair further towards testing its next major support near 1.2850 region.

Meanwhile on the upside, 1.3065 level seems to have emerged as immediate resistance. However, major upside resistance remains near 1.3100 handle, above which the recovery momentum could get extended towards 1.3160-65 resistance area.