The Pound bulls are starting to lose momentum as downbeat political plays in the UK contribute to the pair’s weakness. A Labour-party member accused PM Johnson of cover-up over report on Russian intervention in UK politics. Also increasing the pessimism is the Brexit party leader Nigel Farage’s latest swing to put nearly 600 candidates for the upcoming snap election in December to cut votes from the Conservatives and hold a command in negotiations. Although the October month reading of Composite and Services PMI from the UK will be in the spotlight for the Pound traders, any new Brexit headline will remain the main sentiment driver.
The Pound buyers remain in control in the big picture; however, the short-term looks uncertain for now. The 50-day moving average is currently acting as support as the Cable bulls are attempting to find momentum once again. That said, the buyers need a close above 1.2930 to regain short-term possession and target the swing highs, 1.3011. On the other hand, a drop below 1.2850 will extend the losses towards 1.2790, which is the bottom of this consolidation period.
Support: 1.2850 / 1.2790
Resistance: 1.2930 / 1.3011