UK inflation data published in the European session overnight was seen as failing to support the strengthening of the Pound currency.
Inflation levels in September remained at 6.7%, missing forecasts to fall to 6.6%.
The pound showed an increase at the start of the published data, but failed to continue and traded weak again again in the following session.
Price movements on the GBP/USD currency pair chart show that the 1.22000 level remains a strong obstacle for the price which has still failed to be penetrated.
Prices tested this level in the European session last night, but retreated again before the strengthening of the US dollar in the following session pushed prices lower.
It is a signal of a change in the bearish price trend if the price starts to move below the Moving Average 50 (MA50) resistance on the 1 hour time frame on the chart and decreases to around 1.21400.
A slow decline pattern was exhibited in the Asian session this morning (Thursday), with the expectation that the 1.21000 zone would be the target to be tested.
If this zone is successfully penetrated, the price will slide lower towards the support zone in early October, namely around 1.20500.
On the other hand, if the price shows an initial increase, after clearing the MA50 barrier it will retest the 1.22000 resistance zone.
After this strong obstacle is finally successfully broken through, then the price will continue to rise higher with the hope of reaching around 1.23000.
This is the resistance zone that was the focus of last week, and the analyst expects there will be an interesting price reaction in this zone.
