GBP/USD Awaits CPI Release: Resistance Under Pressure
The GBP/USD pair is currently engaging traders with a test of resistance, as the markets await today's U.S. CPI data with bated breath.
Technical analysis: GBP/USD has been making a play towards the upside following its ascending trendline, etched out by the black support line. We’ve seen a bit of a tussle around the 1.27 area, which is acting as a minor resistance. Bulls are trying to punch through, with the pair repeatedly nudging this level. It’s a critical moment, as a breakout above this zone could quickly turn the tables to the upside, eyeing the next resistance near 1.2760. Should the pair take a bearish turn and the support of the trendline crumble, then we’d be eyeing the 1.25400 area, where buyers might step in.
Our position: The stage is set for the U.S. CPI figures to steer the narrative. An unexpected CPI print—higher or lower—could swing the momentum here. Usually a cooler CPI would lend strength to the pound, propelling GBP/USD above current resistance levels and vice-versa. But, as the US economy is in a very tough spot, everything is upside down. A higher than expected CPI would bring the USD down pushing GBPUSD higher. We’re ready to play long on a convincing breakout post-CPI.
Technical analysis: GBP/USD has been making a play towards the upside following its ascending trendline, etched out by the black support line. We’ve seen a bit of a tussle around the 1.27 area, which is acting as a minor resistance. Bulls are trying to punch through, with the pair repeatedly nudging this level. It’s a critical moment, as a breakout above this zone could quickly turn the tables to the upside, eyeing the next resistance near 1.2760. Should the pair take a bearish turn and the support of the trendline crumble, then we’d be eyeing the 1.25400 area, where buyers might step in.
Our position: The stage is set for the U.S. CPI figures to steer the narrative. An unexpected CPI print—higher or lower—could swing the momentum here. Usually a cooler CPI would lend strength to the pound, propelling GBP/USD above current resistance levels and vice-versa. But, as the US economy is in a very tough spot, everything is upside down. A higher than expected CPI would bring the USD down pushing GBPUSD higher. We’re ready to play long on a convincing breakout post-CPI.