GBP/USD retests post-UK CPI trading range hurdle and retreats

The GBP/USD pair continues to find some fresh buying interest around the 1.30 neighborhood and spiked to retest the top end of post-UK CPI trading range near mid-1.3000s, albeit quickly retreated around 15-20 pips threafter. 

The pair gained some traction despite a modest pickup in the US Dollar demand, backed by an uptick in the US Treasury bond yields. The latest leg of up-move over the past hour or so lacked any fresh fundamental driver and hence, could be solely attributed to short covering from an important psychological mark support.

It, however, remains to be seen if the pair is able to build on the up-move or extended its near-term consolidative price-action amid fading expectations of any immediate monetary policy action by the Bank of England, especially after yesterday's softer UK inflation figures.

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Meanwhile, growing doubts over the US President Donald Trump's ability to push through pro-growth economic agenda might continue to restrict any swift greenback recovery and hence, the pair resuming with its prior appreciating move, and moving back above the 1.3100 handle, remains a distinct possibility. 

Next on tap would be the release of US housing market data - building permits and housing starts, which would be looked upon for some fresh trading impetus during early NA session.

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Technical levels to watch

A follow through momentum beyond 1.3060 immediate resistance could accelerate the up-move towards reclaiming the 1.3100 handle, above which the pair seems poised to extend its near-term appreciating move. 

On the flip side, the 1.30 handle remains an immediate strong support to defend, which if broken could drag the pair immediately towards 1.2970 intermediate support en-route 20-day SMA support near 1.2920 region.