Just caught something interesting in the forex market this morning. GBP/USD pushed above 1.3450 after the UK retail sales data came in hotter than expected - month-on-month growth hit 0.3% when everyone was looking for a decline. That's the kind of surprise that gets traders moving.

What caught my eye is how this retail sales beat is changing the rate cut narrative. If UK consumers are still spending despite higher rates, the Bank of England probably doesn't need to rush into cuts. That's supporting the pound right now. Year-on-year retail sales also beat at 1.2% versus 0.8% expected, and even core retail sales excluding food and fuel showed 0.4% growth.

Technically, the pair jumped to 1.3485 intraday before settling around 1.3460. The 1.3500 level is the next resistance to watch - hasn't been tested since early 2022. Support is sitting at 1.3400 and 1.3350. RSI is at 58 and MACD just flipped positive, so momentum looks decent.

The retail sales strength is basically saying the UK economy isn't falling apart like some feared. That divergence with weak Eurozone data makes sterling look relatively attractive. Watching for UK inflation data next week - if that's still sticky, could add more upside pressure. But for now, consolidation around these levels seems likely.