GBP/USD Analysis: UK Parliament defies Johnson’s plans
|GBP/USD Current Price: 1.2892
- UK MPs rejected PM Johnson’s proposed timetable in an attempt to delay Brexit.
- EU’s representatives have now to announce which kind of extension they would grant.
- GBP/USD bearish case firmer on a break below 1.2860, post-decision low.
The GBP/USD pair plunged to the 1.2860 price zone after the UK Parliament voted in favor of the Withdrawal Agreement Bill, but rejected PM Johnson’s proposed timetable that would have forced MPs to pass legislation within the next three day. Right after the vote, PM Johnson said that it would pull the UK from the EU by October 31, making no mention to an upcoming election.
A PM spokesman later said that Johnson’s next step would be having talks with EU leaders and ask them not to extend the October 31 date, although hinting his open to a short extension. The never ending-Brexit soup continues, with more Parliament discussions scheduled for Wednesday. Next market’s big reaction will probably be linked to whatever EU representatives announce next.
GBP/USD short-term technical outlook
The GBP/USD pair is trading near its daily lows, although a bearish continuation needs further confirmation in the short-term, as, in the 4-hour chart, it has broken below its 20 SMA for the first time in almost two weeks. At the same time, technical indicators have turned sharply lower, now challenging their midlines, not yet within negative levels. A recovery, however, seems unlikely in the current scenario. A break below 1.2860 will lift odds of a bearish continuation in the upcoming sessions.
Support levels: 1.2860 1.2820 1.2785
Resistance levels: 1.2910 1.2950 1.2990
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