GBP/USD trying to hold onto 1.3950, but bearish pressure mounting

• The Sterling bear run may not be over as the Greenback remains elevated.
• Bond yields are sending the USD higher, and a lack of impactful data on the calendar leaves the markets exposed to overall sentiment.

The GBP/USD is holding steady near the 1.3950 level after drooping for five straight days as the USD surges in the broader FX markets, bolstered by US Treasury yields with the 10-year note approaching the critical 3 percent level.

GBPUSD: Sellers will arrive today at minor levels at 1.3965

With only mid-tier data on the calendar for both currencies, the main trend will continue to reflect overall market sentiment, with risk appetite riding high but the US Dollar's recovery outshining any gains in other risk assets. Trade war fears have been temporarily shelved, as have Brexit concerns as the UK and the EU begin to look further apart on a clean Brexit agreement than many initially thought, and either of these risk factors for the GBP/USD could swing back into the markets' peripheral at any moment.

GBP/USD Levels to watch

The Sterling is looking quite overextended on the recent bearish stretch, but with little change in the underlying fundamentals the shortside is likely to remain in control, and as Jim Langlands noted, "the hourlies are showing some minor bullish divergence, but with the 4 hour momentum indicators pointing sharply lower, a break of 1.3925 would allow a run to the Mid-March lows at 1.3913/1.3890, below which there is not too much to stop a run to 1.3865 (76.4% of 1.3710/1.4376). On the topside, sellers will arrive today at minor levels at 1.3965 and 1.3980 ahead of 1.4000 and the Fibo level at 1.4030, and further out at 1.4095 although this looks unlikely to be seen again for a while. Take a nimble stance today, but technically is does appear that further downside pressure may come about, looking for a run towards 1.3965."