Tuesday, October 22, 2019

GBP/USD

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Fundamental Highlights

The British Pound remains relatively unchanged as market participants are waiting for today’s result of the vote on the bill. The 115-page Brexit bill published by the UK government yesterday will get its second reading in the House of Commons today. The government believes it has a majority to pass this stage even though the opposition Labour Party and other rival parties are expected to oppose it. The government then has to layout the timetable for the remaining stages of the legislation, which needs approval from lawmakers. If parliament does not agree to the timetable, PM Johnson's plans to leave on Oct. 31 could be derailed. That could yield a bearish pressure on the Cable.

Technical Analysis

Despite the current uncertainty, the bulls tested the 1.30 during yesterday’s session multiple times, as they are still holding on to the recent strong uptrend. However, the decisive moment is near. A break below the bullish uptrend will likely pull price back towards 1.2885 and possibly lower. However, once 1.30 is taken out by the bulls, it will likely trigger a series of short squeeze pushing the Sterling above 1.30.

Support: 1.2885/ 1.2785
Resistance: 1.2991 / 1.3050

Chart (H4)
GBPUSD