GBP/USD Forecast: Sterling falls to new 2018 lows as EU refuses Brexit deal renegotiation

The GBP/USD currency pair fell to 1.2650 representing fresh 2018 low after the European Commission said it won’t renegotiate the Brexit agreement.
The European Court of Justice (ECJ) announced its decision on the Article 50 case and ruled that the UK can unilaterally revoke Brexit notification of its intention to withdraw from the EU.
The UK Cabinet is meeting to discuss strategy for UK parliament to vote on Brexit deal tomorrow, December 11 with Theresa May to make a statement to the UK parliament at 15:30 GMT.

Mario Blascak, PhD Independent Analyst

The GBP/USD currency pair is trading down 0.7% at around 1.2660 after falling to new 2018 low of 1.2650 with the European Commission rejecting the option of Brexit deal re-negotiation as the tensions rise before the UK parliament voting on Brexit deal tomorrow evening, with Theresa May struggling to secure enough vote in favor of her deal. There are rumors of Prime Minister Theresa May pulling the crucial vote on her Brexit deal. She will reportedly make a statement to the House of Commons at 15:30 GMT.

There are contradicting headlines coming out concerning the Brexit agreement vote from the UK with some speculating about the UK Prime Minister trying to delay the vote and buy more time to get more members of UK parliament on her side.

Meanwhile, the UK Cabinet is meeting with the possible Brexit deal vote in the UK parliament canceled or postponed. UK Minister Andrea Leadsom responsible for notifying parliament about the vote canceled all of her meeting today.

The GBP/USD currency pair is still trapped in a downward sloping trend on a 1-hour chart and needs to break to above 1.2800 to build a potential higher. The technical oscillators including Momentum and the Relative Strength Index are both sliding lower in the neutral territory while Slow Stochastics made a bearish crossover and it is pointing lower. The Brexit uncertainty continues to weigh on GBP/USD with 1.2650 new 2018 low already reached and a short-term target on the downside. On the upside, the GBP/USD needs to confirm the break above 1.2800 to reverse the downtrend.

GBP/USD 1-hour chart

Author

Mario Blascak, PhD

Independent Analyst

Dr. Mário Blaščák worked in professional finance and banking for 15 years before moving to journalism. While working for Austrian and German banks, he specialized in covering markets and macroeconomics.

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