GBP/USD outlook: Cable hits new multi-month high on hotter than expected UK inflation

Slobodan Drvenica Windsor Brokers

GBP/USD

Cable eased to 1.3400 zone on Wednesday after fresh acceleration on hotter than expected UK inflation data probed through peaks of 2024 and 2025 (1.3434/1.3444) and hit the highest in over three years (1.3468).

Although gains were so far short-lived, as traders collected some profits on overbought signals, overall bullish structure is expected to remain intact.

Weakening dollar remains among main drivers of pound, with unexpectedly strong rise in consumer prices In April (the largest increase since 2022 / hit the highest in 15 months) adding pressure on the central bank for fewer rate cuts or delay in policy easing and making sterling more attractive.

Daily studies remain in full bullish setup (strengthening positive momentum / rising thick daily cloud continues to underpin the action / daily Tenkan/Kijun-sen about to complete bull-cross), though bulls may pause for consolidation due to overbought conditions and persisting headwinds that 1.3434/44 barriers produce.

Dips are likely to be limited and provide better levels for re-entering bullish market.

Res: 1.3468; 1.3500; 1.3557; 1.3600.
Sup: 1.3400; 1.3360; 1.3305; 1.3250.

Interested in GBP/USD technicals? Check out the key levels

1. R3 1.3474
2. R2 1.3434
3. R1 1.3414
PP 1.3374
1. S1 1.3354
2. S2 1.3314
3. S3 1.3294

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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