The Sterling saw a temporary increase on Friday after comments from EU's Chief Negotiator Barnier, saying that the EU is willing to give the UK the chance of a unilateral exit. However, the Pound erased all of those gains and closed the day back at the lows, as Barnier later continued that there was no progress made last week. Moreover, today during the Asian session, the GBP/USD gapped down as the UK rejected several EU Brexit offers on Sunday. Investors will closely monitor the UK parliamentary voting beginning tomorrow in order to determine the short-term trade direction. In terms of economic data, the BOE will release Consumer Inflation Expectations, previously at 3.2%.
The Pound gapped down below the 1.30 psychological support during the Asian market open. The outlook remains bearish as price is trading below both the 50 and 200-day moving averages (blue and orange lines). The bulls need to break back above 1.30 (R1) to gain some traction, or else we will likely see price retesting 1.29 (S2) in the near future.
Support: 1.2970 / 1.29 / 1.2850
Resistance: 1.30 / 1.3050 / 1.31