GBP/USD bulls once again fail ahead of 1.34 handle, US ISM PMI next

   •  Upbeat UK services PMI helps regain positive traction on Tuesday.
   •  Reviving USD demand/Brexit uncertainty now seemed to cap gains.

The GBP/USD pair trimmed some of its upbeat UK data-led strong gains and quickly retreated around 35-40 pips from session tops.

Earlier today, the pair touched an intraday high level 1.3393 and the up-move was supported by yet another stronger than expected UK PMI print. Following the recent UK manufacturing and construction PMI beats, the UK services PMI also bettered expectations and boosted the case for August BoE rate hike move. 

The bullish momentum, however, once again fizzled ahead of the 1.3400 handle, with a modest pickup in the US Dollar demand, despite the ongoing retracement in the US Treasury bond yields, prompting some fresh selling at higher levels. 

It would now be interesting to see if the pair is able to attract any follow-through traction or the inability to make it through the mentioned barrier marks the end of current corrective bounce from 6-month lows set last week amid uncertainty surrounding Brexit talks. 

Traders now look forward to the key highlight from today's US economic docket, the release of US ISM non-manufacturing PMI, in order to grab some short-term opportunities.

Technical outlook

Valeria Bednarik, FXStreet's own American Chief Analyst writes: “Intraday technical readings support some additional gains ahead, as in the 4 hours chart the pair is back above a mild-bullish 20 SMA, while technical indicators have bounced nicely from their mid-lines, now maintaining their upward slopes near overbought levels. The 1.3390/1.3420 price zone is a key resistance area, and won't be easy for the pair to take it over. If it does, however, chances for an extension up to the 1.3500 price zone increase.”