The Pound continues to trade lower as investors see no significant developments in the Brexit negotiations. Deal negotiations are still stuck on one major topic, the Irish backstop. The issue is that the UK would like to remove Northern Ireland from the customs union with Europe while also maintaining a soft border between Northern Ireland and Ireland. The EU believes that if Northern Ireland is removed from the customs union then a hard border should be created on the Irish island. Some are currently speculating that there is a chance all of the UK will remain in the EU customs union as a means to solve the Irish backstop issue. Until anything factual is confirmed, the Pound will continue to trade around the 1.2955 support level.
The British Pound continues to trend below all the three moving averages as a representation of the bearish sentiment surrounding the pair. Interestingly, the pair continuously rejects the break above the 13-period moving average signaling a strong short term bearish bias. The pair will form a new lower low if investors are successful in selling off the Pound below 1.2921.
Support: 1.2921 1.2840
Resistance: 1.2960 1.3020