For some reason, sterling is one of the best performing major currencies against the US dollar, but the fundamental situation seems very bad in the UK as well. Thus, it is hard to say why the GBPUSD pair is rocketing higher.
It looks like the pair is now consolidating in a narrow range, and bulls are regrouping to push the pound further higher. The resistance zone of this range is at around 1.2460, and if the GBPUSD pair breaks above this resistance, the potential for the initial rally is circa 200 pips (the width of the consolidation channel). Therefore, the first target could be at around 1.2660 and afterward, near the 1.28 level.
Alternatively, the support seems to be near 1.2350, and if not held, the GBPUSD pair could decline to the lower bound of the channel, which is near 1.2250.
Volatility has declined recently, which is a sign that it can come back if the pair breaks from the mentioned consolidation range.
