GBP/USD: On the back foot around 1.2130 amid Brexit pessimism


  • GBP/USD clings to 10-day EMA after fresh signs of no-deal Brexit.
  • The UK PM writes a letter to the EU showing alternative arrangements to Irish backstop ahead of Germany/France visit.
  • The bloc reiterates no scope for Brexit deal renegotiations.

With the fresh blow to British PM’s expectations of a deal with the EU, the GBP/USD pair declines to 1.2126 on Tuesday morning in Asia.

In an effort to push the EU over Brexit negotiation table, the UK Prime Minister (PM) Boris Johnson wrote a four-page letter to the region’s leader Donald Tusk offering alternative arrangements of the Irish backstop. However, the EU firmly said, as per The Guardian, that the withdrawal agreement is not open for renegotiation and the backstop is not open for change.

Previously, the British PM arranged a long call with his Irish counterpart Leo Varadkar for renegotiation on the Irish backstop issue. Though, no positive results could be spotted at the end.

Also, the opposition Labour party, together with some Tory rebels, stand ready to topple the PM Johnson with a no-confidence vote as soon as the Parliament resumes during early September. It should be noted that there prevails a lack of accord upon who will become the interim PM if they succeed to force Mr. Johnson out.

On the other hand, the UK leader has cordial support from the US during a call with the US President Donald Trump, as per The Sun.

While major attention will be given to the PM Johnson’s EU visit and the Jackson Hole Symposium, intermediate trade/political news will be looked closely amid the absence of major catalysts.

Technical Analysis

A downside break of 10-day exponential moving average (EMA) level of 1.2120 can drag prices to eight-day-old rising support-line at 1.2085 now. Alternatively, 1.2210/15 area including August 06 high and July 29 low can keep the quote’s short-term increase capped.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

FXStreet Trading Signals now available!

Access to real-time signals, community and guidance now!

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD holding above 1.18 ahead of critical US data

EUR/USD is holding onto its gains, trading above 1.18 as the dollar remains on the back foot. ADP's US job report and the ISM Non-Manufacturing PMI provide critical clues toward the Non-Farm Payrolls. Fiscal stimulus talks and geopolitics are also in play.

EUR/USD News

XAU/USD bulls unstoppable, renews life-time highs near $2040

With ‘buy the dips’ emerging as the main underlying theme behind the gold (XAU/USD) price action so far this week, the bulls flex their muscles further to record fresh all-time highs near $2040.

Gold News

GBP/USD trades around to 1.31 amid dollar weakness, ahead of data

GBP/USD is trading around 1.31, recovering as the dollar retreats. The UK government is under scrutiny for its management of the virus crisis. Services PMIs on both sides of the Atlantic are eyed.

GBP/USD News

Forex Today: Gold smashes $2,000, dollar depressed, two Non-Farm Payrolls hints eyed

Stocks, bonds, and precious metals are on the rise while the greenback is falling alongside falling yields. Investors are eyeing slow progress in fiscal stimulus talks and top-tier US figures ahead of the Non-Farm Payrolls.

Read more

WTI hits fresh two-week highs near $42.50 ahead of EIA data

WTI (futures on Nymex) extends its winning-streak into the third straight day on Wednesday, as the bulls challenge the July high of $42.51.

Oil News

Forex MAJORS

Cryptocurrencies

Signatures