GBP/USD hits fresh multi-month tops, around mid-1.3100s
- GBP/USD gains traction for the fifth consecutive session on Thursday.
- Increasing odds of a majority for Conservatives remained supportive.
- Overbought conditions on short-term charts warrant some caution.
The GBP/USD pair finally broke out of its Asian session consolidation phase and jumped to fresh multi-month tops, around the 1.3145-50 region in the last hour.
The British pound remains one of the top-performing currencies and was being supported by the fact that the incoming UK election polls have been indicating a majority for the Prime Minister Boris Johnson's Conservative Party.
UK political optimism, weaker USD supportive
On the other hand, the US dollar bulls seemed rather unimpressed by renewed trade optimism, wherein a Bloomberg report on Wednesday indicated that the US and China are moving closer to a deal before the December 15 tariffs deadline.
Wednesday's weaker releases, showing that private-sector employment increased by 67K in November as against 140K expected and the ISM Non-Manufacturing PMI fell to 53.9 from 54.7 previous, continued weighing on the greenback.
The mentioned supporting factors, coupled with some follow-through technical buying helped the pair to build on its recent strong bullish momentum and continue scaling higher for the fifth consecutive session on Thursday.
However, overbought conditions on hourly/daily charts warrant some caution before placing any fresh bullish bets and cap any further gains amid absent relevant market moving economic releases from the UK.
Later during the early North-American session, some second-tier US economic data – trade balance figures and the usual initial weekly jobless claims – might influence the USD and produce some short-term trading opportunities.
Technical levels to watch