Key events today:

12:30 UTC: USD – Consumer Price Index.

On Tuesday, GBP/USD found room to climb, gaining almost 0.2% and returning to the 1.2800 level, aiming for a key price level that has recently challenged the bullish momentum. Pound traders are on edge, awaiting Wednesday’s release of the US Consumer Price Index (CPI).

This week, data focused on the British pound is limited, as the UK calendar features only medium-impact economic releases. As a result, the pair will rely solely on Wednesday’s CPI inflation data, which is one of the last major releases before the Federal Reserve’s final meeting in 2024. Signs that inflation progress has stalled could crush hopes for a third consecutive rate cut on December 18. Currently, the market expects November’s US CPI inflation to rise slightly to 2.7% year-over-year from the previous 2.6%, with the core annual CPI holding steady at 3.3%.

GBP/USD is grappling with short-term chart fluctuations near the 1.2800 mark, with the pair stuck in a dead zone around 1.2830. The price is slowly recovering after bottoming near 1.2500 at the end of November, but the bullish momentum is facing challenges.

Recommendations: Monitor the 1.2800 level. If the price consolidates above it, consider Buy positions; if it bounces off, consider Sell positions.