The British Pound recovered yesterday, as the EU’s three-month Brexit extension set the tone of the Cable’s latest recovery. Additionally, increasing odds of the December election and public support to the PM Johnson seems to help the pair to push upwards. Furthermore, a recent poll by the UK’s Daily Mail suggests that the Tory leader is ahead of the opposition Labour party Head Jeremy Corbyn. Adding to the upside could be the exit of Nigel Farage’s Brexit party from most polls, which in turn supports Tories during the December month election. Moreover, the market’s reaction to the US Fed third consecutive rate cut has been negative on the Dollar, which provided an additional support for the Sterling.
The Pound buyers were able to breakout from the 50-day moving average targeting next the 1.2950 level. A successful break above that level will likely extend gains towards the key psychological resistance 1.30. The bears on the other hand, need to break below 1.2850 to stop this current bullish momentum.
Support: 1.2850 / 1.2790
Resistance: 1.2950 / 1.3012