The Pound slipped as Brexit tension was reflected by comments from U.K's Prime Minister Theresa May and EU's chief negotiator Michel Barnier. May restated and promised that she maintains her stance on the U.K leaving Europe while Barnier made it clear that he “strongly” objects parts of May's Brexit proposal. In addition to the uncertainty surrounding Brexit, the Sterling also faced pressure from the rise in demand for the U.S Dollar. Demand for the greenback increased as trade tensions between the U.S and China escalated and thus spurred demand for save haven currencies. For today, the Pound will be driven by developments surrounding Brexit talks and trade tensions between the U.S and China.
Following comments from Theresa May, the Pound opened with a gap down as the trading week started. Adding to the bearish momentum, the Pound broke both the 13-period moving average and the 200-period moving average following the gap down. Moreover, the pair broke below a price action support level at 1.29374. The Pound still has the 50-period moving average to break before moving lower towards the 1.28287 level.
Support: 1.29024 1.28287
Resistance: 1.29374 1.30214