The Sterling remained under pressure yesterday after PM May’s new Brexit deal proposal was met with disappointment as it offered nothing new and emphasized on the second referendum. Furthermore, the resignation by the House of Common Leader and a Tory member Andrea Leadsom showed more fragility in the current UK political climate as PM May looks to also step down by Friday, as cited by the UK Times. Looking ahead, the UK will release the Retail Sales numbers but the main attention remains on Brexit as the UK political uncertainties will continue to keep the markets on the edge as the risks remain highly to the downside.
The Pound broke below 1.27 yesterday, a very important support level, as the bears are in full control. Today we are likely to see more downside pressure on the Cable as price is attempting to break below 1.2650 support, if the bears succeed then price is possibly heading towards 1.26. The bulls need to break back above 1.27 to pause the sellers’ dominance and give the Sterling some room to breathe.
Support: 1.2650 / 1.26 / 1.2550
Resistance: 1.27 / 1.2750