GBP/USD Forecast: Remains Vulnerable To Slide Further, Toward Mid-1.2900s

On Friday, the GBP/USD pair did recover back above the 1.3100 handle after the headline NFP print came below consensus estimates, albeit failed to sustain at higher levels. Upbeat US ISM non-manufacturing PMI helped negate softer monthly jobs report-led US Dollar weakness and kept a lid on any meaningful up-move for the major.

Adding to this, comments by the BoE Governor Mark Carney, that Brexit may limit central bank's ability to cut interest rates and add to the risks of slower UK economic growth in case there is no Brexit deal, further collaborated toward capping the pair below the 100-day SMA through the Asian session on Monday. 

Moving ahead, the UK PM Theresa May is set to address the CBI conference in London on Monday and the incoming headlines might infuse some fresh volatility across the GBP crosses. Later during the American session, NY Fed President William Dudley is also due to speak and help traders grab some short-term trading opportunities. 

Technically, the pair has been finding some buying interest near a short-term descending trend-line support, but is now finding it difficult to decisively move back above the 1.3100 handle. Hence, it would be prudent to wait for a decisive break through Friday's trading range before positioning for the pair's next leg of directional move.

A convincing break below the mentioned descending trend-line support, currently near the 1.3040-30 region, the pair might turn vulnerable to break below the key 1.30 psychological mark and head toward testing its next support near mid-1.2900s, marking the 61.8 percent Fibonacci expansion level of the 1.3657-1.3027 downfall and its subsequent rebound.

Alternatively, a sustained move beyond the 1.3100 handle, leading to a follow-through buying interest beyond the 1.3130 hurdle, might trigger a short-covering bounce back toward the 1.3200 round figure mark en-route to a 1.3225-30 heavy supply zone.