The British Pound crashes to 1.2500 after Prime Minister Theresa May decided to postpone the UK Parliament’s Brexit vote, which was due today. Such postponement signaled that the parliament was expected to vote against May’s controversial Brexit plan, leading to further uncertainty about the future of Brexit and the economic outlook of the UK. The Sterling was also pressured by a strengthening US Dollar, as investors moved towards safe haven currencies due to concerns surrounding the future performance of the global economy.
The Pound breaks below the 1.2609 support exposing the next key support level at 1.2490. The momentum of the pair is clearly bearish as prices are trading well below all the three major moving averages. Before executing a short position, investors need to be aware that prices might possibly retest the 1.2600 level and the 13-period moving average before continuing the push lower.
Support: 1.2609/ 1.2490
Resistance: 1.2720 / 1.2790