GBP/USD: Upside capped near 1.2140 ahead of UK CPI

The GBP/USD pair extends its struggle to rise above 1.2140 resistance in the European session, as the bulls now enter a consolidation phase, as we move closer to the UK CPI release.

GBP/USD: 1.2050 or 1.2150 on UK data?

GBP/USD’s more-than a big figure recovery from daily lows of 1.2018, appears to have lost legs in Europe, as markets turn on a cautious mode and book profits ahead of the risk events for the pound lined up later today, with the all-important UK PM May’s speech on Brexit guidelines.

Also, a minor bounce attempted by the greenback versus its main peers, combined with negative European equities added to the renewed downslide in the major.

Markets eagerly await the UK CPI data, which is expected to tick higher to 1.4% y/y in Dec versus 1.2% booked previously.

GBP/USD Levels to consider            

In terms of technical levels, upside barriers are lined up at 1.2164 (10-DMA), 1.2180 (key barrier) and 1.2200 (zero figure). While supports are aligned at 1.2039 (daily pivot) and 1.1988 (multi-week low) and below that at 1.1850 (post-Flash crash low).