The British Pound benefited from the recent diminishing fears of a hard Brexit following the reports that the EU may grant another extension to the UK to prevent a no-deal Brexit. Furthermore, an EU diplomat has said, “the best meeting since the negotiations with Frost started but not yet the beginning of a solution". Meanwhile, the UK PM Johnson said that he is working to get a deal with the EU within weeks. As a result, the Cable will remain favored in today’s session, as long as the positive mood surrounding Brexit remains the main market driver.
The Cable bulls broke above 1.2450 on Friday, retesting new highs not seen since July. The bulls are clearly in control, setting up a strong uptrend eyeing 1.2550 and 1.26 as their next possible targets. The bears however, remain under pressure, as they need to take out the 1.2450 support for a possible deeper pullback towards 1.2385, but even with that sell-off attempt, the overall trend will remain bullish.
Support: 1.2450 / 1.2385
Resistance: 1.25 / 1.2550