The Pound and US Dollar were affected by inflation data reports published in the European and New York sessions yesterday.
UK inflation recorded a decrease to 2.5% in December, lower than the forecast to remain at 2.6%.
Meanwhile, United States (US) inflation in December met the forecast to increase to 2.9% compared to 2.7% the previous month.
With the focus more on US inflation, price movements in the New York session were more aggressive as investors digested important indicators that influence the Federal Reserve (Fed) monetary policy.
The GBP/USD currency pair chart is watched for investors to assess the impact of the published data on the current price movement.
There was a decline in the European session when UK inflation was published with prices reaching around 1.21600 before bouncing back up.
Hovering around 1.22000, the price then jumped 100 pips to reach a high of 1.23000 in the early New York session in reaction to the release of US inflation data.
Later, the strengthening of the US dollar has pushed the price back down from the 1.23000 level to reach the 1.22000 level again which is the price support.
Next, the price movement slowed towards the end of the session and continued into the Asian and European sessions today (Thursday), the price slowly above the 1.22000 zone.
The observed price movement is also still above the Moving Average 50 (MA50) support line on the 1-hour time frame on the GBP/USD chart, indicating that the price is still holding on to the fall.
If the price drops below the 1.22000 level after breaking through the MA50 support, the identified bearish signal will push the price further down towards the support level at the beginning of the week at 1.21000.
However, if the price rebounds, resistance is at the 1.23000 level reached yesterday to be retested.
