GBP/USD Price Forecast – Brexit Woes Keeps British Pound Pressured Below 1.30 Handle

The British Pound last week saw a sharp slide to three-week lows as Brexit woes continue to pressure GBP in the broad market. Talks between UK & EU representatives failed to see any fruitful progress in regards to Brexit deal as traders and UK citizens alike await key Brexit vote scheduled to occur in UK parliament this week. As the deadline approaches closer with each passing day, the upcoming parliament session is the main focus of traders across the globe as failure to take key decisions during to upcoming meeting on future progress is likely to lead to messy and disorderly Brexit scenario. Further, headlines from the weekend suggested that the UK officials rejected a new deal proposed by EU as the deal wasn’t much different from the one previously rejected by UK officials.

UK Parliament Meeting Eyes For Directional Cues

This caused the GBPUSD pair to decline below 1.30 handle with a gap down move during Pacific-Asia market hours. Investors have held back from placing any major bets ahead of the upcoming parliament meeting as they wait to see if lawmakers will do what is required or just postpone critical decisions similar to recent past. While the pair opened with a gap down move below 1.3000 handle, USD’s weakness which carried forward from last Friday’s mixed macro data outcome helped GBP rebound from intra-day lows and move back above 1.3000 handle ahead of London market hours. As of writing this article, the GBPUSD pair is trading at 1.3006 up by 0.25% on the day.

Moving forward, investor focus is on UK parliament session set to begin tomorrow ahead of which traders are unlikely to any major bets and are on the lookout for macro data updates for short term profit opportunities. On the release front, UK macro calendar remains silent for the day aside from speech by BOE MPC member Haskel while US calendar will see the release of retail sales data and business inventories data. When looking from a technical perspective, the path with least resistance in short term is towards upside but price momentum in reality is controlled by Brexit headlines and could go either way depending on the outcome of tomorrow’s parliament meeting. Expected support and resistance for the pair are at 1.2950, 1.2900, 1.2850 and 1.3035,1.3065, 1.3100 respectively.

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