GBP/USD rallies to 1.2680 on positive trade news and strong UK data

GBP/USD has surged 0.6% (76 pips) to 1.2680, marking its highest level in two weeks as sterling benefits from favorable trade developments and robust UK economic indicators. The pound's strength was triggered by reports suggesting smoother post-Brexit trade negotiations and better-than-expected UK retail sales data, which rose 2.3% month-over-month versus 1.5% forecast. Market sentiment toward sterling has improved significantly, with traders now positioning for continued UK economic resilience despite global headwinds. The positive momentum has pushed GBP/USD through key resistance at 1.2650, with the next target at 1.2720 (March highs). Technical indicators show strong bullish momentum, with the RSI approaching overbought territory at 68. Support has formed at 1.2630 (previous resistance), while a sustained break above 1.2700 could accelerate gains toward 1.2800. The move reflects growing confidence in the UK's economic trajectory and reduced Brexit-related uncertainties.