GBP/USD steadily climbs to session tops, above mid-1.3100s ahead of Brexit amendment votes

   •  The British Pound remains supported by decreasing odds of a no-deal Brexit.
   •  The USD weighed down by dovish Fed expectations and helps regain traction.
   •  All eyes remain glued to the UK parliamentary debate on alternative Brexit plan.

The GBP/USD pair quickly reversed an early European session dip to the 1.3130 area and refreshed session tops in the last hour, recovering a part of the previous session's modest pull-back.

After last week's strong rally to the highest level since mid-October, levels beyond the 1.3200 handle, the pair posted slight losses at the start of a new trading week and extended the pull-back during the first part of Tuesday's trading session.

Despite the uncertainty surrounding Britain's eventual exit from the European Union, the British Pound remained supported by receding risk of a no-deal Brexit and turned out to be one of the key factors limiting any meaningful downfall.

This coupled with a subdued US Dollar price action, amid dovish Fed expectations, further collaborated to the pair's intraday bounce of over 40-45 pips, though the upside is likely to remain limited ahead of the parliament debate on the UK PM Theresa May's alternative Brexit plan.

Mario Blascak, FXStreet's own European Chief Analyst explains: “The UK Prime Minister is said to accept so-called Brady’s amendment calling for the planned Irish backstop to be replaced by "alternative arrangements". Such a solution is expected to be rejected by the European Union. Ahead of the Brexit amendments vote, the uncertainty increased and it is weighing on Sterling.”

There isn't any major market moving UK economic data due for release on Tuesday, while the US economic docket highlights the only major release of the Conference Board's consumer confidence index and will be looked upon for some short-term trading impetus.

Technical levels to watch

“The GBP/USD rose to a fresh 15-week high of 1.3214 and the GBP/USD is set to experience the further corrective pullback. The bullish breakout of the Fibonacci level of 1.2990-1.3000 becomes a support level now and the first price target on the downside.  On the upside, the immediate resistance is at around 1.3150,” Mario added further.