After having declined toward 1.2400 earlier in the session, GBP/USD has reversed its direction and rose above 1.2450. The US Dollar Index fell sharply with the immediate reaction to the softer-than-expected CPI data from the US, providing a boost to the pair.
GBP/USD trades near the 20-period and the 50-period Simple Moving Averages (SMA) on the four-hour chart. Additionally, the Relative Strength Index (RSI) indicator stays near 50, highlighting the pair’s indecisiveness.
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On the upside, 1.2450 (lower limit of the ascending regression channel) aligns as initial resistance. Once the pair returns within the ascending channel by clearing that hurdle, additional gains toward 1.2500 (psychological level, end-point of the latest uptrend) and 1.2550 (mid-point of the ascending channel) could be witnessed.
In case GBP/USD falls below 1.2400 (psychological level, 20-period SMA, 50-period SMA) and confirms that level as resistance, it could decline toward 1.2350 (Fibonacci 23.6% retracement, 100-period SMA) and 1.2300 (psychological level).