GBP/USD keeps the red near session lows, around mid-1.3300s

   •  Upbeat US data fails to lift the USD and might help limit downside.
   •  Passage of tax-cut legislation seems already priced in the market.

The GBP/USD pair extended its rejection slide from the 1.3400 handle and refreshed session lows on better-than-expected US data.

The pair held weaker near session lows, around mid-1.3300s after the US housing market data for November bettered expectations. According to data released by the Commerce Department, the US housing starts jumped to a seasonally adjusted annual rate of 1.297 million in November, posting a growth of 3.3% as compared to a downwardly revised pace in October.

Meanwhile, building permits also ticked up 1.4% to a 1.298 million annual rate and the US current account deficit fell more than expected and came in at $100.6 billion during the third quarter. 

The market, however, seems to have already priced in the passage of Republican-backed tax-cut legislation and hence, today’s upbeat data also failed to provide any lift to the US Dollar bulls, which might now help limit further downside for the major, at least for the time being.

Technical outlook

Valeria Bednarik, American Chief Analyst at FXStreet writes: “Technically, the short-term picture is neutral-to-bearish as the price is now developing below a modestly bearish 20 SMA, while technical indicators hold directionless below their mid-lines. An immediate support comes around 1.3345, with a stronger one at 1.3300, where the pair bottomed twice during this December. In the meantime, the pair continues developing inside a descendant trend channel, with the roof of the figure now at 1.3400.”