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VT 
The GBP/USD pair experienced a rise above key technical levels largely due to the general weakening of the US Dollar. This increase saw the pair gaining nearly 1% in a day, reaching a fresh weekly high around 1.3350 during the European trading session.
US inflation data contributed to the Dollar’s weakness, as the Consumer Price Index indicated annual inflation dropped to 2.3% in April from 2.4% in March. This influenced the GBP/USD to gain momentum during the American trading hours.
Elliott Wave Analysis
The primary Elliott Wave count on the GBP/USD hourly chart suggests the end of a corrective Wave (C) near 1.3140. This could mark a potential bottoming out, indicating the start of a new rally.
The bullish shift is supported by views expressed by Huw Pill, the Chief Economist at the Bank of England, who addressed inflationary issues in the UK. His comments coincided with the pair’s positive movement, underscoring ongoing market reactions to macroeconomic updates.
The information in this article is for informational purposes only, carrying risks and uncertainties in trading, which should always be carefully considered. The responsibility for any investment decisions remains with the reader.
With the GBP/USD pair pushing past technical resistance near 1.3350, attention was firmly drawn to the underlying momentum seen in the European session. The move upward was spurred not by sterling strength alone but largely traced back to softer data from the US. Specifically, the retreat in US Consumer Price Index figures to 2.3% adds to the view that inflationary pressure is beginning to cool more steadily than anticipated. For perspective, the March figure stood higher, and the monthly decline serves to scale back expectations for further aggressive tightening by the Fed.
Market Dynamics and Projections
This subtly shifts the environment that traders are navigating, as the justification for holding a stronger Dollar becomes thinner. When market participants react to inflation falling faster than projections, the Dollar tends to weaken—this is precisely what we observed during the US session.
From a technical analysis perspective, the completion of the Elliott Wave (C) near the 1.3140 level casts a more bullish shadow over the pair. This isn’t merely a corrective bounce. If the narrative is correct, the retracement has already run its course, and what’s developing now could be interpreted as the early stages of a broader impulse wave, not a simple upward blip. For those who analyse the chart structure closely, such transitions can provide a cleaner framework for positioning, particularly as upward momentum indicates more than a reactionary pop.
Meanwhile, when Pill weighed in on domestic inflationary pressures in the UK, his remarks earned attention for being relatively measured. Ongoing stickiness in UK price rises strengthens the case against swift rate cuts by the Bank of England. As we interpret it, this has buoyed the currency. His comments served more as a reminder than a forecast, but they were aligned well with how the pound traded throughout the session. It’s not just what is said—it’s when it’s said, and in this case, the timing lent added clarity to traders mapping future interest rate paths.
In the short term, price breaching the highs around 1.3350 sets a clear marker to watch. Long positions that built near the prior correction zone now ride with the trend, and profit-taking behaviour near resistance levels may provide added volume clues. We’ve often looked for these kinds of signals to confirm trend resilience or sniff out early signs of fatigue.
In upcoming sessions, volatility around Dollar inputs—particularly anything related to employment or forward guidance from Fed officials—will offer further shape to implied rate differentials. Similarly, with the UK not far from CPI updates of its own, traders may revisit current longs or shorts on GBP in light of any upside surprises. Reaction speed to these releases, not just direction, will matter for risk management.
Position sizing and stop placement remain central. Knowing when a move is overstretched compared to prior volatility bands keeps exposures appropriate, rather than emotional. When momentum strengthens rapidly, spreads widen and entries become less forgiving. We’ve found it useful to stay reactive with limits when underlying fundamentals and price action both reinforce a scenario—but not overstay entries past key retracement markers.
For the time being, expect the market to continue playing short-term Dollar softness against resilient UK inflation expectations. Relative central bank narratives are diverging more than converging. Until that trend shifts, we’ll be watching closely for momentum confirmations through volume and volatility expansions, particularly near round-number barriers where institutional interest tends to cluster.
