- Challenges to the lead runner of the UK PM’s race and EU’s harsh stand against no-deal Brexit drag please sellers.
- Monthly economic data and political plays to follow for fresh direction.
Race for the UK’s next PM has been entertaining the GBP/USD pair traders as it declines to the intra-day low around 1.2720 during the early Asian sessions on Monday.
With Theresa May’s forced quit leaving a void in the British political system, many of the popular politicians came forward to take the reign. Among them, ex-Foreign Minister Boris Johnson has been leading the run whereas latest addition of the London Mayor Sadiq Khan adds interests into the event.
Recently, The UK Telegraph published a news report quoting sources close to the French PM Emmanuel Macron that Boris Johnson’s pledge to not pay Brexit bill will lead to a sovereign debt default. The British politician has also offered heavy tax cuts at home if he gets selected.
Other than looming uncertainties over who will take charge of the UK’s economy, Financial Times report conveying the EU’s warning to the businesses in case of a no-deal Brexit also weighed on the Cable.
Looking forward, Britain’s monthly figure of the gross domestic figure together with manufacturing and industrial production numbers could entertain momentum traders while political plays can keep questioning the broad scenario of trading.
Technical Analysis
Sustained trading above the 21-day simple moving average (SMA) at 1.2707 questions the pair’s inability to cross 1.2760/70 resistance-area comprising multiple highs marked since May 20. As a result, chances of the quote’s rise to February month low near 1.2775 on the break of 1.2770 can’t be denied. On the downside, 1.2670, 1.2600 and May month bottom near 1.2560 seem crucial supports.
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