GBP/USD weaker but above 1.3400

• Pound among the worst performer in Europe, affected by Brexit jitters.
• GBP/USD about to end the flat, far from weekly highs but above 1.3400.

The GBP/USD pair pulled back today after reaching the highest level in two weeks at 1.3472. It was about to end the session hovering around 1.3420/25, near the same levels it closed on Wednesday. On a weekly basis, the pair is posting a 70-pip gain.

The correction from 1.3470 accelerated on European hours on the back of rumors about the resignation of the Brexit minister, David Davis. The UK government presented a plan that would keep UK in the EU Customs Union after Brexit until a permanent solution to the Irish border is found.

On Friday, the Bank of England will release its consumer inflation expectations report while no relevant data is due in the US.

Short-term outlook

GBP/USD is still moving in a bullish channel but the upside lost momentum. They key uptrend line support is seen at 1.3330/50: a break lower would remove the positive tone and could open the doors for a test of 1.3300.

“Trading at around 1.3430, the 4 hours chart shows that the buying interest defended ground around a bullish 20 SMA, while technical indicators have retreated from overbought levels, but pared their slides and are actually trying to regain the upside, favoring another leg lower, although Brexit jitters may be a drag, opposing to technical readings”, said Valeria Bednarik, Chief Analyst  at FXStreet.