GBP/USD analysis: hopes boost the Pound in a critical week in the Parliament

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.3139

UK lawmakers will vote on May's deal this Tuesday, a possible extension coming Wednesday.
Last-minute talks continue with May and Juncker meeting in France.

The Sterling fell to a fresh March low against the greenback of 1.2960, to later soar to 1.3149, as Brexit headlines kept coming ever since the day started. Pound's decline was linked to headlines suggesting that PM May could be ousted, amid the lack of progress with EU's negotiations ahead of this Tuesday's Parliamentary vote on her deal. Despite multiple meetings that took place last week, no progress was achieved. There were some market talks suggesting that Tuesday's vote could be a provisional one, indented to vote on the intentions of the government and not on a new deal, angering MPs. The late advance was triggered by news indicating that UK's May and EU's Juncker will meet shortly in France, to try to clinch a last-minute deal. Irish Foreign Minister Coveney said that the EU was trying to put up a package to provide the Parliament with the reassurances they need, boosting optimism in the last trading session of the day. UK lawmakers will decide this Tuesday, whether or not PM May's deal is enough. In the case it gets rejected, they can vote on an extension to the departure date beyond March 29 on Tuesday.

The pair trades near its daily high ahead of the Asian opening, now offering a short-term bullish stance, given that, in the 4 hours chart, the price recovered above its moving averages, with the 20 SMA having lost its downward slope and technical indicators back in bullish territory. Technical readings, however, had little to do in the current Brexit scenario, although the break of critical levels can trigger stops and fuel some directional moves. The main resistance now is 1.3185, where the pair topped last Friday, while to the downside, bearish pressure should increase on a break below 1.3090.

Support levels: 1.3090 1.3050 1.3010

Resistance levels: 1.3185 1.3220 1.3260

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Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

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