GBP/USD bounces off 1-week lows, still deep in the red near 1.3100 mark

   •  Market participants seem convinced that May’s deal will be rejected for the third time.
   •  Recovering US bond yields revive the USD demand and added to the bearish pressure.
   •  Technical selling below the 1.3100 handle further accelerates the intraday downfall.
 
The selling pressure around the British Pound picked up the pace in the last hour, dragging the GBP/USD pair to further below the 1.3100 handle, or one-week lows.

The pair finally broke down of its three-day-old broader trading range and remained depressed through the mid-European session amid firming expectations that the UK PM Theresa May might still struggle to get enough votes to pass her Brexit deal through the Parliament.

Adding to the Northern Irish DUP's position to not support May's deal, former Brexit Secretary Dominic Raab called on renegotiating the Withdrawal Agreement or leaving without a deal on April 12th and dented the already weaker sentiment surrounding the British Pound.

Adding to this, a goodish pickup in the US Dollar demand - supported by an intraday turnaround in the US Treasury bond yields and despite weaker than expected final US Q4 GDP print, further collaborated towards aggravating the selling pressure around the major.

Meanwhile, possibilities of some short-term trading stops being triggered on a sustained break below the 1.3140-35 horizontal support and the 1.3100 round figure mark could also be one of the factors behind the pair's sudden fall during the early North-American session.

Technical levels to watch

The pair is now holding below 200-period SMA on the 4-hourly chart and hence, a follow-through weakness below the 1.3080-75 region might turn the pair vulnerable to accelerate the slide further towards challenging the key 1.30 psychological mark.

On the flip side, the 1.3135-40 region now becomes immediate resistance, which if cleared might trigger a short-covering bounce back towards the 1.3200 round figure mark but any subsequent up-move seems more likely to remain capped near the 1.3225-30 region.