GBP/USD opens offered, flips bid and targets Friday's 1.3217 high
|- GBP/USD opened Asia on Monday with a bearish gap of some 15 pips only to reverse and get through 1.32 the figure.
- GBP/USD is currently trading at 1.3203, up from a low of 1.3182 as investors get set for the next chapter in Brexit.
Sterling had a strong week last week, driven by amendments to PM May’s Plan B which aims to prevent a no-deal Brexit and will be voted on this Tuesday. However, the weekend news has weighed on the pound at the open with Ireland saying it would not accept any changes to an agreement aimed at preventing a hard border.
"However, whether the government can propose an amendment acceptable to the Conservative Party, Dublin and Brussels is still a huge unknown," analyst at ANZ Bank explained, adding, "Apart from wanting to avoid a general election, growing rumblings that NI Republicans will push for a reunification referendum under a no-deal Brexit may also be influencing the DUP. Meanwhile, there are some signs that EU resolve is softening a touch. However, the situation remains very uncertain."
GBP/USD levels
- Support levels: 1.3165 1.3130 1.3090
- Resistance levels: 1.3220 1.3260 1.3300
Valeria Bednarik, the Chief analyst at FXSteet, explained that the pair is bullish according to technical readings in the daily chart:
"It settled well above its 200 EMA, above it for the first time since April last year. In the mentioned chart, the 20 DMA maintains its bullish slope well below the current level as technical indicators head firmly up, entering overbought territory."
"Shorter term and according to the 4 hours chart, the pair is also poised to extend its advance, as despite technical indicators lost their upward strength, hold consolidating in overbought readings, as a sharply bullish 20 SMA keeps advancing above the 200 EMA, now at 1.3050."
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