GBP/USD churns ahead of quiet week

• GBP/USD waffled near 1.2600 on quiet start to the trading week.
• Market flows are likely to remain tepid on US holiday-thinned week.
• GBP-centric economic data remains light through Friday.

GBP/USD churned chart paper near the 1.2600 handle, finding thin gains through the day's market window but failing to recapture the technical level as market flows do little to bolster the Pound Sterling. The UK side of the week's economic calendar is constrained, and a fresh print of key US inflation data on Wednesday will give way to a shortened trading week on the US side as Americans prepare for their Thanksgiving holiday.

A general improvement in broad-market risk appetite trimmed the top off of Greenback bidding to kick off the new trading week, giving the Pound Sterling a mild boost and keeping Cable bids chewing on bids just south of the 1.2600 handle. GBP traders will be grappling with a low-impact release calendar throughout the week, and US session market flows will be front-loaded onto Tuesday and Wednesday before the holiday slowdown.

The Federal Open Market Committee's (FOMC) latest Meeting Minutes will be released later in the day on Tuesday, giving traders a glimpse into the Federal Reserve's (Fed) latest discussions about the direction of interest rates looking forward. Wednesday will follow up with another update to US Personal Consumption Expenditure Price Index (PCEPI) inflation, a key reading of price increases underpinning the US economy. Wednesday also brings a quarterly update of UIS Gross Domestic Product (GDP) growth. Annualized core PCEPI inflation is set to accelerate again in October and forecast to increase to 2.8% from the previous 2.7%. Qoq US GDP growth in the third quarter is expected to hold steady at 2.8%.

GBP/USD price forecast

GBP/USD remains hobbled on the south side of the 1.2600 handle, churning bids north of 1.2500 as the pair finds some breathing room after another leg lower from early November's choppy plateau just below 1.3000. Cable reached a six-month low of 1.2487 late last week, clipping into a 7% decline top-to-bottom from September's peaks at 1.3434. 

In the near-term, Pound bulls hoping for an end to the current Greenback upshot will be looking for intraday bids to return to the 200-day Exponential Moving Average (EMA) near 1.2840, while long-run short positions will be looking for an opportunity to redevelop momentum and drag Cable back to 2024 lows at the 1.2300 handle.

GBP/USD daily chart