It retreats below 1.3100 as traders eye key US CPI data

• GBP/USD slips towards key support at 1.3044, with momentum favoring another near-term decline.
• RSI turns bearish, signaling potential losses, with next support at 1.3000 and 50-DMA at 1.2940.
• For buyers to regain control, GBP/USD needs to clear the resistance at 1.3143 and push towards 1.3200.

GBP/USD is on the back foot after hitting a daily high of 1.3107 following a solid UK jobs report, although it has pulled back below the 1.31 level as traders await the release of data on US inflation. At the time of writing, the pair is trading at 1.3052, down 0.17%

GBP/USD Price: Technical Insights

GBP/USD’s decline towards the July 17 peak at 1.3044 could put downward pressure on the pair and pave the way for further losses.

Momentum favors short-term sellers. The Relative Strength Index (RSI) remains bullish, although its slope is aiming lower and is about to turn bearish, which could accelerate the pound’s decline against the greenback.

In this scenario, the GBP/USD path of least resistance is tilted to the downside. The first support would be 1.3044, followed by the psychological figure of 1.3000. A breach or the latter will expose the 50-day moving average (DMA) at 1.2940, ahead of the 1.2900 mark.

Conversely, if buyers would like to regain control, they need to break past the September 9 high at 1.3143 before having a chance to challenge the 1.3200 figure.

GBP/USD Price Action – Daily Chart