GBP/USD stalls at Support Prior to US & GBP Economic Data

GBP/USD has retreated into the 1.2650 key level, which has been a consistent support and resistance pivot level of the last 2 years. This also marks the fibonacci golden pocket of 50% - 61.8% retracement from the high.

Sentiment during July was to sell USD on rallies, so traders must be asking whether to continue buying pound and selling dollars now - a difficult question with US CPI data and UK GDP data on the horizon.

Given the Fed have shown willingness to continue hiking rates, a soft CPI figure would infer the Fed to be less likely to hike rates in the near future, and could see the dollar sell.

The forecasts for the British GDP are hopefully, anticipating a increase after the previous month's contraction.

Thursday this week:
USD - CPI m/m, Estimate: 0.2%, Last: 0.2%
USD - CPI y/y, Estimate: 3.3%, Last: 3.0%

Friday this week:
GBP - GDP m/m, Estimate: 0.2%, Last: -0.1%
GBP - Prelim GDP q/q, Estimate: 0.0%, Last: 0.1%

My personal view is for GBP/USD to continue its longer term bullish trend, and I'll be waiting for Thursday/Friday to see the data.