The dollar held steady on Tuesday as markets awaited the crucial US consumer inflation report due on Wednesday. The report will continue to shape the outlook for Fed rate cuts. An unexpected jump in inflation could lower the likelihood of a rate cut in December. On the other hand, if the figures come in line with expectations or lower, the dollar will collapse as rate-cut bets increase. The market recently raised the chances of a December rate cut after US unemployment jumped from 4.1% to 4.2%. Bets increased from 70% to 85%, weighing on the dollar. Another downbeat report could push bets to 100%. Meanwhile, the pound has recovered since the Trump trade as the dollar weakened ahead of the December Fed meeting. However, the UK economy remains fragile despite the Labour government’s new budget. In fact, data on Monday revealed that demand for labor had dropped in the UK, showing a slowdown in the labor sector. If this trend continues, the pound might resume its downtrend as BoE rate cut expectations increase. GBP/USD key events todayThere will be no high-impact economic releases from the UK or the US today, so the pair might trade in a thin range. GBP/USD technical price analysis: Price revisits channel support GBP/USD 4-hour chartOn the technical side, the GBP/USD price has maintained a shallow bullish trajectory, trading mostly above the 30-SMA. At the same time, it trades in a bullish channel with clear support and resistance lines. Bulls recently broke above the 1.2701 resistance level to make a higher high. However, the price has pulled back to retest the 30-SMA and the channel support line. If bulls remain in the lead, GBP/USD will bounce off this support zone to make new highs. As a result, the price would target the 1.2901 resistance level. On the other hand, a break below the support zone would signal a reversal. Bears would confirm this by making a new low below the 1.2701 support level.More By This Author:USD/CAD Forecast: Loonie Tumbles After Canada Jobs DataEUR/USD Outlook: Fed Rate Cut Odds Boost EuroAUD/USD Outlook: RBA Rate Cut Outlook Briefly Boosts Aussie

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