GBP/USD Daily Price Forecast – Brexit Headlines Continues To Underpin GBP BullsHeadlines inspired momentum helped GBP scale 1.31 handle where it has managed to sustain a positive price rally.
British Pound is the star of this week risky forex asset given that GBPUSD is the best performing high-risk forex pair of the week. While Brexit headlines and proceedings continue to remain the main driving force behind British Pound’s recent rally, the latest leg of bullish price action has been influenced by an entirely different perspective compared to earlier rallies. The pair saw positive price action on investors hope for a possible extension of article 50 and second Brexit referendum until yesterday. However, news has now hit the market that DUP is willing to support PM May on her Brexit plan B proposal during Tuesday’s UK parliament vote. Brexit proceedings have ramped up following above-mentioned headlines.
Brexit Progress Boosts Investor Sentiment With Each Passing Day
According to the article published in UK daily newspaper “The Sun” DUP party members are of opinion that parliament gaining control of Brexit proceedings in case PM May loses the vote on Tuesday will lead to messy Brexit and PM May retaining power on Brexit related decisions is the only hope for Decent Brexit. They believe that as long as the specified time limit is provided by EU for Irish backstop they are ready to provide complete backing to PM May. Given the current scenario where either there is a soft Brexit deal or a chance where remaining Tories and Labor party members push for an amendment that extends article 50 and hopefully puts into motion a second Brexit referendum – both of which are looking highly positive for UK’s economy as compared to situation in last quarter of 2018, positive influence surrounding GBP is very high in broad market.
GBPUSD pair managed to breach 1.31 handle over the influx of bullish investor sentiment following the news update and has since sustained a rally above 1.3100 handle. As of writing this article, GBPUSD pair is trading at 1.3111 up by 0.36% on the day. On release front today, UK market will see the release of gross mortgage approvals while the U.S. market will see the release of new home sales data and Core durable goods order data. Macro data could inspire some level of volatility in price action but unlikely to have any lasting impact as investors are focused on Brexit updates ahead of Tuesday’s UK parliament session. The pair is expected to continue further upward price action as long as it has strong support at 1.3100 handle, however, a decline below said level will lead to sharp decline back towards mid 1.30 handle where range bound action is likely to continue ahead of UK parliament vote on PM May’s Plan B proposal.