#GBPUSD @ 1.22743 is looking to recapture 1.2300 amid positive market sentiment. (Pivot Orderbook analysis)

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• GBP/USD is looking to recapture 1.2300 amid positive market sentiment.
• The US Dollar Index has dropped below 105.00 on expectations of a decline in US Inflation.
• Investors should not ignore the expectations of a surprise rise in UK inflation amid a solid food price rise.

The pair currently trades last at 1.22743.

The previous day high was 1.2299 while the previous day low was 1.2207. The daily 38.2% Fib levels comes at 1.2264, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2242, expected to provide support.

The GBP/USD pair has picked demand after dropping to near 1.2260 in the Tokyo session. The Cable is aiming to recapture the round-level resistance of 1.2300 as investors’ risk appetite has improved dramatically ahead of the release of the United States inflation data.

The US Dollar index (DXY) has dropped below the round-level support of 105.00 as pre-US inflation anxiety among investors has faded. S&P500 futures are withstanding their Monday’s gains recorded on expectations of a decline in the inflationary pressures. On a broader note, an expected shift in the approach of the Federal Reserve (Fed) toward the pace of interest rates has underpinned optimism.

The street is expecting a decline in the US Consumer Price Index (CPI) led by a decline in gasoline prices and one-year consumer-inflation expectations. New York’s monthly Survey of Consumer Expectations showed on Monday that the US consumers’ one-year inflation expectation declined to 5.2% in November from 5.9% in October, marking the biggest one-month decline on record. This has resulted in a decline in consensus for headline inflation to 7.3% and core inflation to 6.1%.

On the Pound Sterling front, investors are awaiting the release of the United Kingdom Employment and CPI data, which are due on Tuesday and Wednesday respectively. The quarterly Unemployment Rate (October) is seen higher at 3.7% against the former release of 3.6%. Apart from that, the crucial catalyst is the Average Earnings data. Quarterly Average Earnings excluding Bonus data are seen higher at 5.9% vs. the former release of 5.7%.

While the UK headline inflation is expected to decline to 10.9% from the former release of 11.1%. Investors should not ignore the expectations of a surprise rise in inflation as food price inflation has soared led by the food supply crisis due to shortages of labor and higher input costs.

Technical Levels: Supports and Resistances

GBPUSD currently trading at 1.2276 at the time of writing. Pair opened at 1.2271 and is trading with a change of 0.04 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 1.2065, 50 SMA 1.1651, 100 SMA @ 1.1669 and 200 SMA @ 1.2117.

The previous day high was 1.2299 while the previous day low was 1.2207. The daily 38.2% Fib levels comes at 1.2264, expected to provide support. Similarly, the daily 61.8% fib level is at 1.2242, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 1.2219, 1.2167, 1.2127
• Pivot resistance is noted at 1.2311, 1.2351, 1.2403

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