GBP/USD that rose above the key 1.5838 level to a 2-week high of 1.5860 on Friday slipped on Monday despite a stronger-than-expected data and is now targeting 1.5649 as immediate support (S1).

If the sterling continue to lose ground, the pair may fall below 1.5483 (S2) to 1.5295 (S3) a fall below which will confirm the end of the short-term uptrend.

On the upside, GBP/USD has to face with tough resistance in the 1.5952-1.5996 region (R1) and 1.6104 (R2) before retesting the 10-month high of 1.6297 (R3) hit on November 4.

Despite a decrease in pace since August correction, the uptrend formed mid-May is still up and running, but retesting R3 (1.6297) looks less likely given the year-end sluggishness in activity.

At 2:21 pm GMT, the pair was at 1.5752, after falling as low as 1.5718 and down from Friday's close of 1.5813.

National Statistics said Monday that the country's producer prices rose 0.9 percent month-on-month in November against market expectations of 0.8 percent growth. On year, the index rose 9 percent, higher than 8.3 percent where the market was seeing and 8.2 percent in October.

Rightmove's November house price data released earlier in the day showed year-on-year, prices rose only 0.4 percent, lower than previous month's 1.3 percent.

With no data scheduled for Monday from the US, investors are eying US retail sales and producer price data for November as well as Fed's monetary policy announcement due Tuesday.

The EU leaders' summit scheduled for December 16-17 will also be crucial for the forex market as the outcome of the meeting which may address differences of opinion over the euro-area bonds will help gauge the demand for the greenback.

Despite

Despite a decrease in pace since August correction, the uptrend formed mid-May is still up and running, but retesting R3 (1.6297) looks less likely given the year-end sluggishness in activity.