GBP/USD strengthens back above mid-1.4000s ahead of UK CPI

   •  Brexit optimism continues to underpin the British Pound.
   •  Subdued USD demand supportive of the up-move.
   •  UK CPI eyed for some impetus ahead of the Fed and BoE.

The GBP/USD pair broke out of its Asian session consolidation phase and jumped to fresh session tops, just above mid-1.4000s in the last hour.

The latest positive Brexit development, wherein the EU and UK have finally agreed on the Brexit transition deal, continues to underpin the British Pound. This coupled with a subdued US Dollar price action remained supportive of the pair's bid tone on Tuesday.

It would now be interesting to see if bulls are able to maintain their dominant position or the 1.4100 handle continues to keep a lid on any the pair's bullish trajectory as investors now look forward to the latest UK inflation figures for some fresh impetus.

The headline CPI is estimated to have eased in February but any upside surprise could once again put pressure on the BoE to hike rates again and eventually trigger some fresh GBP strength. 

Further gains, however, is likely to be limited ahead of this week's key event risks - the Fed and the BoE monetary policy decision, which would help determine the pair's next leg of directional move. 

Technical levels to watch

Immediate resistance remains near the 1.4100 handle, above which the pair seems all set to surpass 1.4145-50 intermediate resistance and head towards reclaiming the 1.4200 round figure mark. 

On the flip side, the key 1.40 psychological mark now seems to protect the immediate downside, which if broken might prompt some additional long-unwinding trade and drag the pair towards 1.3960-50 support area.