The UK Parliament has passed the Brexit bill, paving the way for the government to trigger Article 50 and begin talks with EU. The bill could receive the royal assent today and become a law.
PM Theresa May could trigger article 50 as early as today, although many in the markets believe that May would do so at the month end.
In the recent past, we have seen that the British Pound loves Brexit clarity. The pattern could be repeated today. Furthermore, reports are doing the rounds that PM May is set to reject Nicola Sturgeon’s plans for a new Scottish referendum.
Hence, the weakness in the GBP/USD pair seen in the Asian session could be short lived. The pair was offered earlier today at the 10-DMA level of 1.2220 and was last seen trading around 1.22 levels.
GBP/USD Technical Levels
A break below 1.2182 (5-DMA) would open doors for a sell-off to 1.2132 (Mar 9 low) and 1.21 (zero figure). On the other hand, a breach of resistance at 1.2220 (10-DMA) could yield a revisit to 1.2251 (previous day’s high), above which the gains could be extended to 1.2307 (Mar 2 high).
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