GBP/USD plummets to fresh lows, below 1.3100 handle

   •  Cable breaks down through the 1.3100 handle.
   •  UK political jitters help offset USD weakness. 

Persistent selling bias around the British Pound dragged the GBP/USD pair back below the 1.3100 handle during the early NA session on Wednesday. 

Against the backdrop of last week's dovish BOE rate hike, the latest political development in the UK exerted some fresh downward pressure on the British Pound. 

The UK PM Theresa May faces another crisis after British International Development Secretary Priti Patel, also a Brexit campaigner, failed to declare meetings with Israeli officials in a breach of diplomatic protocol.

   •  GBP: Cabinet calamity? – Rabobank

The news revived concerns over the effectiveness of May’s leadership and whether she would be able to bring the Brexit negotiations to a conclusion. The development helped negate a modest US Dollar weakness and has bee one of the key factors for the pair's downslide on Wednesday.

In the absence of any major market moving economic releases, weakening sentiment around the GBP is turning out to be an exclusive driver of the pair's downside on Wednesday.

Technical levels to watch

Valeria Bednarik, American Chief Analyst at FXStreet writes: "The 4 hours chart shows that the pair is retreating after correcting half of its previous loses, now hovering around the 23.6% retracement of the same decline. The price broke below its 20 SMA, while technical indicators gain bearish traction, with the RSI already at 42, favoring additional declines ahead, moreover on a break below 1.3090, the daily low, aiming then for the 1.3020 region, where it bottomed earlier this month."