GBP/USD technical analysis: Cable takes a dip before today's CPI reading

• Cable trades 0.09% lower on the session heading into the CPI reading.
• CPI year on year is expected to come in 0.1% lower than last months 1.7%.

GBP/USD 4-hour Chart

Today leading into the CPI data cable has taken a dip lower.

The reading is projected to be slightly higher than lasts months reading but we have seen some GBP strength since September.

In October GBP/USD moved 6.71% higher from the low to the high and EUR/GBP lost 4.88% of its value.

This should push inflation lower due to the purchasing power of GBP. Having said that there are some one-off price increases in certain items (like oil).

Looking at the 4-hour chart below, you can see the small triangle-shaped formation has broken to the downside. 

The main consolidation low support stands at 1.2769 and if this gets taken out the next significant support zone is at 1.2535. 

Later in the session, we are also due to hear from Fed Chair Powell and have the US CPI reading, so we could expect to see more volatility.

Additional Levels