GBP/USD holding the 1.30 handle and above 200-D SMA trap-door at 1.2975
- GBP/USD is currently trading at 1.3069, trading between 1.3030 and 1.3074.
- Cable is making a come back following a poor show on Friday over doubts swirling around British Prime Minister Theresa May's attempt to further delay Brexit.
There has been a void of progress reports today as Brexit takes a middle seat as investors get set for the FOMC minutes this week and concentrate more so on equities and trade. However, as simmering away as always, Brexit headlines have still be coming through as follows:
- Jeremy Corbyn's detailed statement on this evening’s Brexit talks with the government
-
Corbyn: Government doesn't seem to be moving from its original red lines
-
Theresa May is not out of the woods yet - The Guardian
-
Brexit: The 1922 Committee has ruled out call for a fresh no-confidence vote in May
-
Brexit Summit Preview: Three scenarios and GBP/USD reactions, Flextension, Euro-Fudge, or Brexident
In a nutshell, the markets are focussed on Article 50 and preparations for the possibility of the European parliamentary elections. It remains the government’s intention to leave the EU with a deal and pass the necessary legislation before 22 May as so that the UK does not need to participate in European Parliamentary elections.
However, a government spokesman has said today that "as a responsible government, today we have taken the necessary steps required by law should we have to participate," :
The Day of Poll Order provides returning officers with a date to hold potential European parliamentary elections but it does not make these elections inevitable as leaving the EU before the date of election automatically removes our obligation to take part.
Meanwhile, we recall from last week is that May wrote to Brussels asking to delay Britain's EU departure until June 30 to allow lawmakers to agree on a withdrawal deal. However, a spanner in the works could be France and the Netherlands that were expressing their doubts about the plan which is keeping the pound anchored. While the chances of a no-deal remain remote, there is still that possibility and a satisfactory outcome anytime soon for Brexit also seems highly unlikely.
GBP/USD levels
While the pound holds off the bears above the 200 day ma at 1.2975, any shock to the upside could see the pound back towards the .3351/82 resistance very quickly, although a breakdown in negotiations will open up prospects to a key Fibo retracement level at 1.2900 and 1.2895.