GBP/USD bullish from 1.2750 as parliamentary Brexit vote looms

Sterling catching a leg up against the US Dollar as interest rate expectations get adjusted, at the Greenback's expense.
Brexit pressure is set to resume this month as headlines continue to churn out of the UK and the parliament gets set to vote on May's deal.

Joshua Gibson FXStreet

GBP/USD is trading into 1.2750 heading into the London market session for Monday, and although broader market sentiment is improving and dragging the GBP along with it, Brexit concerns remain the key driver of the Sterling as the UK's parliament gears up for a vote on Prime Minister Theresa May's Brexit withdrawal proposal.

PM May pulled her EU divorce bill from a parliamentary vote in the eleventh hour last in December when a defeat looked guaranteed. Now Mrs. May's withdrawal proposal is set to be voted on by the UK's House of Commons despite May's delays, with parliament still set to reject May's deal, and with no other alternatives in the pipeline should May's plan fail, GBP sentiment could easily spiral into the bearish side.

Monday delivers little economic data for Sterling or US Dollar traders, leaving Pound bidders to grapple with Brexit headlines as they continue to leak out of the UK, while Greenback traders are still focused on Fed head Jerome Powell, whose words last week knocked back expectations of rate hikes in the future, casting a shadow over the USD.

GBP/USD Levels to watch

Lacking an overall trend as the Cable waffled the last quarter of 2018, technical readings on the GBP/USD pairing are lacking, but FXstreet's Chief Analyst Valeria Bednarik was quick to point out that a slight bullish twist can be seen:

The daily chart for the pair offers a mildly positive technical stance, as it closed Friday above its 20 DMA, as technical indicators bounced from around their midlines, lacking, however, enough momentum to confirm an upward extension in the upcoming sessions. In the 4 hours chart, the pair settled a couple pips above its 200 EMA and well above a still bearish 20 SMA, while technical indicators entered positive ground, although the RSI lost its upward strength around 59, indicating that buying interest is still limited above the 1.2700 mark.

Support levels: 1.2695 1.2655 1.2610
Resistance levels: 1.2745 1.2780 1.2815

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

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