The GBP/USD pair crashed in the short term and now is trading at 1.2018 versus the 1.2269 yesterday's high. Still, after its amazing sell-off, the rate could try to rebound to test and retest the near-term resistance levels before going down.
Fundamentally, the UK reported lower inflation today. The CPI rose by 10.1% versus the 10.3% growth expected, while Core CPI surged by 5.8% compared to the 6.2% growth estimated.
On the other hand, the US data came in mixed today. Retail Sales, Core Retail Sales, and Empire State Manufacturing Index came in better than expected, while Capacity Utilization Rate and Industrial Production came in worse than expected.
Tomorro, the US PPI and Core PPI are seen as high-impact events. Positive US data should lift the greenback.
GBP/USD Could Retest The Sellers!
Technically, the GBP/USD pair registered a false breakout with great separation above the channel's upside signaling exhausted buyers. Now, it has dropped below the weekly pivot point of 1.2070 and under the uptrend line signaling a downside continuation.
As you can see, the rate increased a little in the last two hours and it has retested the broken 1.2030 downside obstacle. The next target is represented by the 1.1960 lower low.
GBP/USD Outlook!
Testing and retesting the broken uptrend line, registering only false breakouts could bring us new selling opportunities. Also, a bearish closure below 1.1960 activates more declines and could represent a bearish signal as well.
