GBP/USD strengthens back above mid-1.4000s ahead of UK CPI
| • Brexit optimism continues to underpin the British Pound.
• Subdued USD demand supportive of the up-move.
• UK CPI eyed for some impetus ahead of the Fed and BoE.
The GBP/USD pair broke out of its Asian session consolidation phase and jumped to fresh session tops, just above mid-1.4000s in the last hour.
The latest positive Brexit development, wherein the EU and UK have finally agreed on the Brexit transition deal, continues to underpin the British Pound. This coupled with a subdued US Dollar price action remained supportive of the pair's bid tone on Tuesday.
It would now be interesting to see if bulls are able to maintain their dominant position or the 1.4100 handle continues to keep a lid on any the pair's bullish trajectory as investors now look forward to the latest UK inflation figures for some fresh impetus.
The headline CPI is estimated to have eased in February but any upside surprise could once again put pressure on the BoE to hike rates again and eventually trigger some fresh GBP strength.
Further gains, however, is likely to be limited ahead of this week's key event risks - the Fed and the BoE monetary policy decision, which would help determine the pair's next leg of directional move.
Technical levels to watch
Immediate resistance remains near the 1.4100 handle, above which the pair seems all set to surpass 1.4145-50 intermediate resistance and head towards reclaiming the 1.4200 round figure mark.
On the flip side, the key 1.40 psychological mark now seems to protect the immediate downside, which if broken might prompt some additional long-unwinding trade and drag the pair towards 1.3960-50 support area.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.