The pound displayed a satisfactory performance last week when it managed to reach its latest high since April 2022.
But investors are wary of trading the Pound this week ahead of UK inflation data to be published on Wednesday ahead of the Bank of England meeting on Thursday.
The Bank of England (BOE) is expected to raise interest rates by 25 basis points to 4.75% and is seen to give an advantage to the Pound currency.
If the US dollar stays on the move for a long time to resume trading this week, the Pound will continue to take advantage of the space to maintain its strengthening.
However, investors are also wary of the possibility of the US dollar strengthening again after the Federal Reserve (Fed) signaled for several more interest rate hikes towards the end of 2023.
The chart of the GBP/USD currency pair has seen its latest high level reached last Friday around 1.28400 after a surge above the 1.27000 level.
The price movement remains above the support level of the Moving Average 50 (MA50) on the 1-hour time frame on the chart showing a still bullish trend.
If the price increase continues earlier this week, the next target is at the height of 1.29000 for the price to reach.
In addition to hitting new highs, prices have the potential to jump higher after the BOE raises interest rates.
However, if the situation changes and sees the price plunge again, the nearest support level for the price is seen at 1.27000 in the RBS (resistance becomes support) zone.
The decline that continues lower will also lead to around 1.26000 which is also one of the focus levels in previous trades.
