GBP/USD retreats from 2-month tops, back below 1.34 handle ahead of US GDP

   •  Positive Brexit news lifts the pair beyond 1.34 handle.
   •  US bond yields now seemed to cap additional gains.
   •  Focus shifts to US GDP/Yellen’s testimony/Carney’s speech.

The GBP/USD pair trimmed some of its early strong gains and has now retreated around 60-pips from session tops, falling back below the 1.3400 handle.

Overnight news reports, suggesting that the UK and EU have in principle agreed to the so-called Brexit divorce bill continued lifting the British Pound across the board, with the pair hitting two-month high level of 1.3431 earlier during the European session.

However, a goodish pickup in the longer-dated US Treasury bond yields, which helped the US Dollar to bounce off lows, kept a lid on any additional up-move. 

With positive Brexit headline acting as an exclusive driver of pair's strong bullish move, traders now look forward to the first revision of US Q3 GDP figures for some fresh impetus.

Also in focus would be the outgoing Fed Chair Janet Yellen's testimony before Joint Economic Committee of Congress and the BOE Governor Mark Carney's scheduled speech at the Fixed Income Currencies and Commodities Markets Standards Board, in London.

Technical levels to watch

Any meaningful retracement below the 1.3400 handle now seems to find support near the 1.3365 level, which if broken could accelerate the retracement back towards 1.3330 support en-route the 1.3300 handle.

On the upside, momentum back above the 1.3420 region could lift the pair towards 1.3455-60 intermediate hurdle ahead of the key 1.35 psychological mark.