GBP/USD has had a volatile session oscillating within a 160 pip range after Brexit developments

Fundamental backdrop

It has been a day of mixed messaged and interesting price action as lots of Brexit headlines hit the wires. The beginning of the session was full of negativity there was short-lived after UK MP Michael Gove stated that "differences in Brexit talks still remain and the UK are looking at steps to safeguard borders after Brexit". Then approximately an hour or so later Ursula Gertrud von der Leyen the president of the European Commission said that the EU has sent formal notice to the UK for breaching its obligations under the Withdrawal Agreement. This was to be expected and any legal action could take months. 

Adding to this flurry of news EU's Barnier then had his say noting that the EU would not sign a trade deal with the UK while the current internal market bill is in place. Following this, the UK PM Spokesman said the UK are committed to working through the joint committee to find a solution to the Northern Ireland protocol.

GBP/USD 30-min chart

The 30-minute chart shows the extent of the volatility in the session on Thursday. The price has now settled in the middle of the 160 pip range close to 1.2895 - 1.29. The area marked in orange is closed to the 1.29 area and is now the focal point of the congestion area. 

If the price does close near the current level it will end the row of three consecutive positive closes in the pair and this may signal a reversal in the trend. There could be some sideways action first however but tomorrow the market will get the latest non-farm payroll data and this could cause some more volatility.

Additional levels