GBP/USD consolidates in a range around 1.32 mark, BoE holds the key

The GBP/USD pair oscillated in a narrow trading range around the 1.32 handle and was seen consolidating overnight sharp pullback from 1-year tops. 

On Wednesday, the pair eroded nearly 150-pips from the 1.3330 region, its highest since September 2016. The initial leg of slide was led by sluggish wage growth, which remained lagged behind rising inflation trajectory and might discourage the Bank of England (BoE) to raise interest rates anytime soon.

The selling pressure aggravated on news that the US tax reform guidance would be announced by September 25, which reignited optimism over the US President Donald Trump's pro-growth economic agenda and provided an additional boost to the US Dollar's strong recovery move. 

The pair stalled its overnight decline near 1.3180 level as investors now look forward to the very important BoE monetary policy decision, due to be announced later during European trading session. 

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Today's economic docket also features the release of US CPI print, which would drive market expectations over the Fed's next policy move at next week's meeting and eventually contribute towards determining the next leg of directional move for the major.

Technical levels to watch

Immediate strong support is pegged near 1.3160 level, below which the pair is likely to extend its corrective slide towards the 1.3100 handle before eventually dropping to 1.3040-35 horizontal support.

On the flip side, 1.3225 level now seems to act as immediate resistance, which if cleared could lift the pair back towards 1.3280 horizontal resistance ahead of the 1.3300 handle and yesterday's swing highs resistance near 1.3330 level.