STERLING SUBDUED AHEAD OF INFLATION REPORT

Sterling has remained subdued in early Tuesday trading, with the GBPUSD pair suffering from a lack of buying interest, and unable to close back above the key 1.2964 technical level, after yesterday's poor UK manufacturing PMI.

British pound traders now look to the UK inflation report hearing, which may indicate the future path of the Bank of England today. The UK construction PMI activity report is also out today, with construction sector expected to soften slightly. After Monday’s downbeat UK manufacturing report, this report becomes significant for investors.

The GBPUSD pair has turned bearish in the short term, with selling pressures building whilst the pair trades below the 1.2964 level. In the medium term, the pair retains a positive bias, whilst clearly trading above the 1.2881 level.

To the upside, resistance is located at the calculated daily pivot point at 1.2964, and the H4 time frame 20 period moving average at 1.2985.

Support for the GBPUSD pair is found at the calculated weekly pivot point at 1.2921, and the daily time frame 20 period moving average at 1.2854.