GBP/USD hobbled at 1.2780 as the well-dented Brexit can gets another kick

Brexit remains the top concern for traders, and little resolve is being seen as the clock continues to wind down on repetitious negotiations.
US holidays for Thursday leave the option for New York Dollar-selling off the table.

The GBP/USD is seeing choppy action in Thursday's pre-London market session, bouncing between 1.2770 and 1.2790, with thin liquidity on the cards as GBP traders await further developments on Brexit.

European-theater market flows will be deciding the Cable's direction, with a thinned-out economic calendar on the offering for Thursday, though a late-session speech from the Bank of England's (BoE) Michael Saunders, a voting member of the BoE's Monetary Policy Committee, will be dropping on markets around 20:55 GMT. Speaking at the Annual South West Economics Dinner, Saunders could drive market reactions with his words as an MPC-voting member, especially with US money absent from Thursday's US trading session as American institutions observe the US Thanksgiving holiday.

Brexit continues to lead front-and-center for Sterling traders, and investors hoping for firmer details from Prime Minister Theresa May's Wednesday meeting with the European Commission's Jean-Claude Juncker saw the can get kicked out to Saturday's short-notice Brexit meeting: PM May's Brexit deal, which finds itself on life support in a race to get it pushed through ahead of the EU's Brexit Summit on Monday, isn't even completed yet, and Pound investors are growing nervous despite negotiators' assurances that "progress is being made". Germany's Angela Merkel is threatening to not even bother showing up to Monday's Brexit Summit if the current deal isn't even finalized, but France's Emmanuel Macron is encouraging the two sides to continue coming together, stating that he welcomes the opportunity to actually weigh in on the talks.

Ireland's Northern border issue remains roughly stitched-over, but Spain has dragged issues about Gibraltar's coast into the mix as the Spanish government demands clarity on the island's borders be worked into the Brexit deal bilaterally, a move that throws a serious wrench in the works as PM May quickly finds herself running out of time to secure a Brexit deal, but even then, significant risks remain ahead: May's own Tory conservative party that currently rules the roost in the UK's own parliament, loaded with Eurosceptic Brexiteers, are continuously threatening to automatically vote down any Brexit deal penned by May, regardless of its content, an eleventh-hour move that would leave the UK at risk to face a no-deal, hard-Brexit head-on.

GBP/USD Levels to watch

Fundamental flows on Brexit will keep the Sterling constrained for Thursday, especially with USD flows from the upcoming US session off the table, and according to FXStreet's own Valeria Bednarik: "concerns about Brexit and a bout of dollar buying mid-US afternoon sent the pair to a fresh weekly low of 1.2763 with the pair trading nearby by the end of the US session. The short-term picture for the pair offers a neutral-to-bearish stance as, in the 4 hours chart, the pair was unable to advance beyond a mild bearish 20 SMA, while technical indicators remain within negative ground, lacking directional strength. The key support is now 1.2723, the low set this month, with a break below it opening doors for a re-test of the yearly low of 1.2661."

Support levels: 1.2765 1.2725 1.2680

Resistance levels: 1.2810 1.2845 1.2890

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