Tuesday, November 27, 2018

GBP/USD - 27 November 2018

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Fundamental Highlights

The Pound breaks below the 1.2810 support as investors feel uncertain about the outcome of the UK Parliament’s Brexit vote. The British currency seems exposed to the downside as the odds of a Brexit vote seem low. Not only is Theresa May’s Brexit plan facing resistance from DUP but she is also facing disapproval from her fellow party politicians. For today, the focus will remain on Brexit and Sterling will move based on investor sentiment surrounding the outcome of the Brexit vote. Keep in mind that the voting results are expected to be released on the 10th of December and until then, the pair will strictly move based on expectations rather than reality. Moreover, investors need to also keep an eye on the movements of the US Dollar given today’s release of the US Consumer Confidence report.

Technical Analysis

The Pound crashes below the 1.2797 support level as uncertainty surrounding the Brexit vote drives investors away from the British currency. Most recently, prices tried to break above the 13-period moving average but a rejection occurred, confirming the bearish bias of investors. The next key level to monitor is at the 1.2729 support zone.

Support: 1.2797/ 1.2729
Resistance: 1.2892 / 1.2937

Chart (H4)
GBPUSD