GBP/USD gained traction in the early American session on Wednesday and started to push higher toward 1.3500. The modest dollar weakness and the stronger-than-expected inflation report from the UK help the pair gather bullish momentum.
The GBP/USD pair surrendered a major part of the stronger UK CPI-inspired gains and was last seen trading below mid-1.3400s, still up nearly 0.15% for the day.
Bulls, however, struggled to capitalize on the move or find acceptance above the 200-hour SMA amid worries that the UK government could trigger Article 16 of the Northern Ireland Protocol. The intraday uptick ran out of the steam near the 1.3470-75 region, which should now act as a key pivotal point for the GBP/USD pair's near-term trend.
Looking at the broader picture, the emergence of fresh selling at higher levels warrants some caution before positioning for any meaningful appreciating move. A subsequent slide back below the 1.3400 mark will be seen as a fresh trigger for bearish traders and turn the GBP/USD pair vulnerable to challenge YTD lows, around mid-1.3300s touched last Friday.
