GBP/USD bulls anticipate a drop in US prices

The GBP/USD pair is up by +0.05% and is trading at 1.2430. While risk sentiment has strengthened, the British pound has found stability in a crucial support level, keeping sterling close to the 10-month high it reached last week on speculation that interest rates will shortly peak and decline later this year.

On Wednesday, Bank of England Governor Andrew Bailey is due to talk at home and may provide insight into the direction of monetary policy in the future, but focus is also on the US Consumer Price Index. According to analysts at TD Securities, core prices are likely to have moderately declined in March, which might contribute to an even weaker US dollar and higher Cable.

The GBP/USD pair is challenging the neckline while trading inside the right-hand shoulder of a large inverted head and shoulders pattern. Almost 70% of the previous positive impulse had been retraced by the time the price started its four-day losing streak.