GBP/USD Forecast: Bearish ahead of Brexit definitions

Valeria Bednarik FXStreet

GBP/USD Current Price: 1.3102

EU Commission President Ursula von der Leyen doubts a full EU-UK deal can’t be achieved by the end of 2020.
UK Parliament to vote on PM Johnson’s Withdrawal Agreement Bill this Thursday.
GBP/USD at risk of accelerating its decline once below 1.3050.

The GBP/USD pair remained under pressure, ending the day with modest looses around the 1.3100 figure. Speculative interest is in wait-and-see mode with Sterling ahead of the UK Parliament vote on PM Johnson’s Withdrawal Agreement Bill, expected to take place this Thursday. The kingdom published the Halifax House Price Index, which increased by 4.0% in the three months to December, beating the market’s expectations.

During US trading hours, the Prime Minister spokesman announced that there wouldn’t be an extension to the post-Brexit transition period. European Commission President Ursula von der Leyen, however, said that she believes that a full EU-UK partnership deal can’t be achieved by the end of 2020. Nevertheless, the financial world was all about Middle-East tensions, which ended up skewing the scale in the dollar’s favor. This Thursday, the UK will publish the BRC Like-For-Like Retail Sales report, while BOE’s Governor Carney is set to deliver a speech.

GBP/USD short-term technical outlook

The GBP/USD pair is hovering around the 1.3100 figure with a bearish stance in the short-term. Throughout the day, the pair was unable to sustain gains above 1.3150, a Fibonacci resistance. In the 4-hour chart, the pair is below its 20 and 100 SMA, while technical indicators stand below their midlines, with moderate downward strength. The next Fibonacci support comes at 1.3050, with bears probably pushing the pair further lower on a break below it.

Support levels: 1.3090 1.3050 1.3010

Resistance levels: 1.3150 1.3190 1.3225

View Live Chart for the GBP/USD

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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