Stealing the focus on trading today (Wednesday) is the movement of the GBP/USD currency pair chart following the UK and United States (US) inflation data to be published in different sessions.
Certainly the main focus of the market this week is directed to US inflation which will be published in the New York session tonight.
In addition to giving an indication of the monetary policy of the Federal Reserve (Fed), the data will also affect the movement of the US dollar.
However, before that attention is paid first to the UK inflation data published at the opening of the European session this afternoon.
The UK's annual inflation rate rose to 2.2% in July from 2.0% previously, but fell short of the forecast figure of 2.3%.
While the core inflation reading slowed to 3.3% compared to expectations to decrease to 3.4% from the previous reading of 3.5%.
The pound showed a negative reaction after the data was published with a fairly significant depreciation which reduced some of the gains made yesterday.
On the chart of the GBP/USD currency pair, the price managed to show a surge yesterday after a rise that broke through the resistance at the 1.28000 zone.
The rally reached a high of around 1.28700 at the end of the New York session before slowing and leveling off throughout the Asian session this morning.
The price drop that occurred in the European session after the UK inflation data was published, saw the price pushed back towards the 1.28000 zone.
If the price movement is successfully maintained above the Moving Average 50 (MA50) support line on the 1-hour time frame on the GBP/USD chart, it will continue to signal continued bullish movement.
If the surge occurs again, the price is likely to retarget the increase towards the 1.29000 level which was not yet reached yesterday.
Breaking higher will show a more clear bullish trend for the price to record the latest high.
However, if the price experiences a more severe fall to pass the 1.28000 zone and the MA50 support line, it will be a bad sign for the price.
A riskier decline can be expected to re-hit around 1.27000, which was the focus zone last week.
