GBP/USD Towards 1.27 during the USA holidays?

The GBP/USD closed positively for the third consecutive trading day on Tuesday, reaching its highest level since early September at 1.2560. Although it experienced a minor pullback on Wednesday, erasing a portion of the weekly gains, the pair managed to remain above the key level of 1.2500.

Later in the session, British Finance Minister Jeremy Hunt is expected to announce the autumn budget statement, which includes significant tax cuts for businesses to stimulate economic growth. Additionally, measures to raise the National Living Wage and enhance the earnings of low-paid workers by approximately 10% are anticipated.

The potential impact of these measures on inflation and inflation expectations is uncertain, but recent statements from Bank of England (BoE) officials suggest a cautious approach towards ruling out future tightening.

Adding to this context, the GBP/USD pair is currently undergoing a rebound, supported by technical indicators signaling a bullish trend. Resistance is foreseen around 1.2556, and a successful breakthrough could propel the pair towards the psychological level of 1.2660. Persistent concerns about US inflation may strengthen the USD, potentially exerting pressure on the GBP/USD pair. Key support levels, especially the 1.2475 level and the minimum 1.2378, will be crucial, as seen on the 4H chart after the schematic accumulation, manipulation, and distribution, along with various support and resistance zones and marked supply levels. Happy trading! I wish you a good day. Greetings from Nicola.