GBP/USD extend losses below 1.30 on resurfacing concerns over disorderly Brexit

• GBP fails to take advantage of the upbeat employment report.
• Latest headlines suggest that the UK is overly optimistic about an orderly Brexit deal.
• US Dollar Index marches higher toward mid-95s.

The GBP/USD, which failed to stay above the critical 1.30 mark after the robust employment figures from the UK, came under a renewed pressure in the last hour following the reports claiming that British officials were misreading the comments from their European counterparts regarding Brexit talks. As of writing, the pair was trading at 1.2982, losing 0.35% on the day.

Citing senior EU sources familiar with the matter, British news outlet The Evening Standard reported that Brussels was uncomfortable because UK officials were misreading the latest statements. “There is no change on substance. The Brits are probably hoping we will change our red lines. This will not happen,” officials said.

Earlier in the day, the data released by the UK's Office Office for National Statistics revealed that the unemployment rate remained steady at 4% in three months to July and the claimant count change,  the change in the number of people claiming unemployment benefits, came in at 8.7K in August compared to analysts' estimate of 10K. Further details of the report showed that average weekly earnings, on a yearly basis, increased by 2.9% excluding bonuses, and by 2.6% including bonuses.

On the other hand, after finding a support a little below the 95 mark, the US Dollar Index gained traction and rose to a new session high at 95.35. Ahead of the JOLTS Job Opening and wholesale inventories data, the index is up 0.15% on the day at 95.30.

Technical levels to consider

A daily close below the 1.30 handle could open the door for further losses toward 1.2950 (50-DMA), 1.2895 (Sep. 10 low) and 1.2810 (Sep. 4 low). On the upside, resistances are located at 1.3000 (psychological level), 1.3085 (daily high) and 1.3125 (100-DMA).