- The British lawmakers’ failures to agree on the future Brexit process continue to weigh on the GBP/USD pair.
- Upcoming data from the US and the UK can entertain intra-day traders while Brexit developments could keep playing their roles.
The GBP/USD pair trades near 1.3070 ahead of London open on Tuesday. The British Pound (GBP) weakened across the board after the UK’s parliament rejected all the four Brexit proposals during early-day indicative votes, giving rise to the threat of no-deal departure. In addition to further developments surrounding the Brexit, investors may also focus on the UK Markit construction PMI and the US durable goods orders to determine near-term trade sentiment.
The British House of Commons again portrayed political disarray as members of the parliament (MPs) rejected all the four Brexit proposals. The incident is a second one after the lawmakers turned down initial seven such motions during last week. With nearly eleven days left for the official EU-UK departure, investors fear no deal between both the parties as the British politicians continue to reject the Brexit plans, be it from the PM Theresa May or from within the parliament.
Some among the UK lawmakers are preparing to again put the PM May’s proposal for a vote as the same is being demanded by the EU to have additional deadline extension by May 22. However, few others are aiming for the second referendum and increase the political noise into the economy.
The uncertainty surrounding the British exit from the EU, popularly known as Brexit, also weighed on market risk sentiment during early-day as the 10-year US treasury yields witnessed pullback from 4.50% high to 4.48%.
Moving on, the monthly release of the UK Markit construction purchasing managers’ index (PMI) will be up at 08:30 GMT. The sentiment gauge is likely to increase to 49.8 from 49.2 but may still remain under the 50 mark the bifurcates industry expansion from the otherwise case.
Elsewhere, the US durable goods orders are bearing market consensus of -1.8% against the +0.3% revised prior whereas order growth for the Non-defense capital goods orders ex-aircrafts may soften to 0.0% from +0.8% earlier.
GBP/USD Technical Analysis
Failure to successfully break the 50-day simple moving average (SMA) highlights 200-day SMA level of 1.2980 followed by the 100-day SMA figure of 1.2925 as important supports.
On the upside, a successful break of 1.3100, comprising 50-day SMA, can propel prices to 1.3155/60 and then to 1.3210 numbers to the north.
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