GBP/USD weaker, testing lows near 1.2300

The Sterling is trading on a soft note on Tuesday, now dragging GBP/USD to challenge the key support around 1.2300 the figure.

GBP/USD lower on USD buying

The pair remains on the defensive during the first half of the week, extending its decline for the fourth consecutive session against the backdrop of a stranger greenback and entrenched fears regarding ‘Brexit’.

Increasing speculations on a Fed’s rate hike by year-end continues to support the sentiment around the buck, capping gains in spot and limiting the upside in the risk-associated space.

Nothing scheduled today in the UK docket, although the speech by MPC M.Saunders before the Treasury Select Committee could grab some attention. Across the pond, the Fed’s Labor Market Conditions Index is only due along with the speech by Minneapolis Fed N.Kashkari (2017 voter, neutral).

GBP/USD levels to consider

As of writing the pair is losing 0.40% at 1.2313 with the next support at 1.1841 (low Oct.7). On the flip side, a breakout of 1.2772 (high Oct.5) would expose 1.2839 (20-day sma) and then 1.2931 (near term resistance line).