GBP/USD marching towards a positive daily close

Following a fall to 1.2375 during the European session, the GBP/USD recovered towards the mid 1.24 area as we approach the end of the trading day. At the moment, the pair is at 1.2437, 20 pips above yesterday's closing level.

Brexit is officially here

Other than the initial fluctuation, markets didn't show a significant reaction to the official commencement of Brexit, as the UK triggered the Article 50 of Lisbon Treaty. Although UK's Prime Minister Theresa May stated that the future relationship with the EU will be different, but will offer the same trade benefits, in her statements later during the NA session, the negotiations are poised to be problematic. Earlier today, a leaked copy of the European parliament's resolution document suggested that the EU is not willing to make any free trade arrangements for the next two years.

UK PM May: Looking for reciprocal arrangement with the European Union

What's next for FOMC?

After yesterday's strong rally, the US dollar index continued to edge higher on Wednesday amid optimistic statements from FOMC members. While Boston Federal Reserve President Eric Rosengren suggested that the U.S. central bank should raise rates at every other FOMC meeting, San Francisco Fed President John Williams pointed out to growing U.S. wealth-to-income ratio as another reason to keep raising rates.

Fed's Williams lauds recovery, sees 3 or more hikes this year - Reuters

Technical outlook 

A break above 1.2450 (Fib. 61.8% of Dec/Jan drop) could allow an extension towards 1.25 (psychological level) and 1.2560 (Mar. 27 high). On the downside, the first technical support is located at 1.2405/10 (50-DMA/100-DMA) followed by 1.2340 (Mar. 21 low/20-DMA) and 1.2300 (psychological level).