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  • GBP/USD bears looking to test the 21-HMA support.
  • Corrective downside to remain limited amid USD weakness.
  • Focus shifts to US CPI, Bailey and Powell’s speech.

GBP/USD is set to extend its four-day winning streak on Wednesday, as the bulls continue to cheer the upbeat market mood, which weighs negatively on the safe-haven US dollar.

The risk sentiment remains buoyed by the US stimulus hopes, upbeat earnings reports and ample liquidity in the markets, which is expected to ramp up the global economic recovery from the coronavirus pandemic induced downturn.

The further upside in the cable also remains at the mercy of the US CPI report, the BOE Governor Andrew Bailey’s speech and the appearance by the Fed Chief Jerome Powell, all of which are lined up later in the NA session.

In the meantime, the bulls are seen consolidating near 34-month tops of 1.3827, holding well above the immediate support placed at the upward-sloping 21-hourly moving average (HMA) at 1.3804.

The buyers are contemplating on the next leg higher, as the Relative Strength Index (RSI) retreats from the overbought region to now trade at 67.80.

Should the corrective reversal pick up pace, the bears could test the 21-HMA support, below which the bullish 50-HMA support at 1.3766 could be put at risk.

Further south, the February 9 low just above the 1.3750 level could guard the downside.

Alternatively, a fresh bid-wave could propel the prices towards the 1.3850 level, beyond which a test of the 1.3900 barrier would be inevitable.

GBP/USD: Hourly chart

GBP/USD: Additional levels