GBP/USD hovers near weekly tops, awaits US CPI for next direction

The GBP/USD pair extended its overnight trend into Asia, as the bulls take a breather ahead of a slew of critical US economic data due later on Friday.

GBP/USD: 1.3000 or 1.2900 on US CPI?

The spot remains better bid so far this session, consolidating the run-up to fresh weekly highs reached yesterday at 1.2955 levels. The greenback continues to remain largely subdued amid mixed remarks from the Fed Chair Yellen, although the downside remains capped, in response to renewed demand for Treasury yields, after Yellen almost indicated the start of balance sheet normalization process as early as this Sept.

Meanwhile, markets shrugged-off renewed concerns sparked over the UK political scenario, especially in light of the Brexit deal, after the UK Government conceded that it will have to pay EU exit bill.  

Later today, the US inflation figures will hold the key for the Fed’s next policy move, and subsequent USD price-action, as the Fed policymakers have lately expressed their concerns over inflation undershooting the central bank’s objective.

GBP/USD levels to consider             

Valeria Bednarik, Chief Analyst at FXStreet noted, “Technical indicators in the 4 hours chart stand pat although within positive territory, whilst the price is above the 20 SMA and 200 EMA, which also lack directional strength. An acceleration through 1.2960 could see the pair advancing up to 1.3000 and beyond, but gains above the threshold have been short lived so caution is recommended. Support levels: 1.2860 1.2810 1.2770 Resistance levels: 1.2895 1.2925 1.2960.”