- Cable moves higher after bottoming out in the mid-1.3000s.
- The pair finds strong support in the 200-day SMA at 1.3056.
- Brexit negotiations entered another deadlock after yesterday’s vote.
GBP/USD is resuming the upside early on Wednesday following yesterday’s moderate drop to the mid-1.3000s.
GBP/USD attention to FOMC, Brexit
GBP is recovering some poise today after a negative start of the week, which saw Cable giving away part of recent gains after being rejected from YTD peaks beyond 1.3200 the figure earlier in the week.
The sell off in the Sterling came after another negative day for PM Theresa May and her plans to impose her views on the ongoing Brexit negotiations. Against the majority of odds, the Cooper amendment (which involved a vote on extending Article 50 if no deal scenario remains by 26 February) did not pass the parliamentary vote, sparking a wave of disappointment among investors.
That said, PM May is expected to meet Labour leader J.Corbyn at some point today, while she will also travel to Brussels in order to try to renegotiate the Withdrawal Agreement as well as options on the Irish backstop.
GBP/USD levels to consider
As of writing, the pair is gaining 0.31% at 1.3105 and a break above 1.3217 (2019 high Jan.25) would open the door to 1.3257 (monthly high Oct.12 2018) and then 1.3298 (monthly high Sep.20 2018). On the other hand, the next support emerges at 1.3056 (200-day SMA) seconded by 1.3036 (10-day SMA) and finally 1.3001 (high Jan.17).
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