The Cable surged intraday after the UK PM May outlined her new Brexit plan, including a key element to hold a vote on whether or not to call a second referendum. The Pound rallied around 130 pips from three-month lows but the rally was short-lived as market participants remain convinced that there is practically no chance for May to get Brexit deal through in June, and a fourth defeat was imminent. The pair erased the intraday gains to settle just a few pips above the 1.27 round figure mark. Today traders will keep an eye on the UK consumer inflation figures and the FOMC minutes, which might collaborate to add some volatility on the Pound across the board.
The Sterling tried to recover beyond 1.2750 for the second consecutive day but the sellers kept the pressure on prices. The bears erased the intraday gains and closed just above 1.27, key support. Today, the weakness in Cable continues as price is already breaking below the 1.27 important support, opening doors for a 1.2650 and even 1.26 retest in the near future. The bulls are looking hopeless with each passing day as the market sentiment is getting severely bearish, the buyers need a close above 1.2750 at least to stop or at least pause this recent sell-off.
Support: 1.27 / 1.2650 / 1.26
Resistance: 1.2750 / 1.28