The 10-D SMA was coming in as a firm support yesterday and has moved up with the price action to 0.8854. On a break above 0.8960 and then 0.8980, the 0.9034 October 2017 high on the wide is a key upside target. The pound was the weakest currency as North America traders walked in due to the inflation data as well as miss PM May’s weak hand in the Brexit negotiations, both of which make for dwindling prospects of a rate hike from the BoE as soon as August. The cross was at 0.8844 in London’s morning yesterday, rallying up to 0.8914 on a near miss on the trade bill vote where the government only beat the rebels by 6 votes, dropping back to 0.8894 for the NY close. Today, the cross was at 0.8873, rallying to 0.8922 on the UK’s June inflation data that completely missed the forecasts – (UK headline inflation was stalling at 2.4% y/y for June while core inflation decelerated to 1.9% y/y in June and at the lowest level since March of 2017). Meanwhile, the euro has been moving up from 1.1601 and reached a high today so far today of 1.1665, popping through the 1.1648 swing level before being capped and currently back into the 1.1630’s at the time of writing. (The euro was initially in Asia overnight to 1.16 the figure and throughout the European session, in an extension of the downside from 1.1744 tops yesterday). Some poor US data had weighed on the dollar and some positive comments from ECB’s Villeroy on the French economy appeared to have been collaborating with the corrective upside as well. Powell’s second day of testimony kicked off earlier where he was repeating his prepared remarks and has not made any material impact on the market. A cliff edge Brexit unfolding Instead, for the cross, eyes stay with Brexit today. A troublesome picture is unfolding after yesterday’s near miss for the government and PM May’s White Paper. The Guardian has reported that “Europe’s officials lay into PM’s plan, with top diplomat saying it will not be basis of talks“. Key quotes from the Guardian’s article: “Led by Michel Barnier’s deputy, Sabine Weyand, the EU’s team of officials picked apart the most contentious parts of the paper as it was presented by Olly Robbins, Theresa May’s chief Brexit adviser, leading to increased concerns on both sides that a no-deal scenario is moving from possible to likely.” “EU diplomats and officials have looked askance at events unfolding in Westminster in recent weeks, and sources said the first EU-UK discussion of the white paper on Monday in Brussels was difficult, with the Brussels representatives voicing the oft-deployed accusation of “cherrypicking”.” “In turn, the UK negotiating team believe the commission’s negotiators are hiding behind the EU’s guidelines, which were published in March last year, stipulating that “the four freedoms of the single market [free movement of goods, capital, services, and labour]are indivisible and that there can be no ‘cherrypicking'”, meaning that Britain would have to accept the free movement of people.” “Both UK and Brussels sources suggested that an informal summit in Salzburg in September was now likely to be a crunch moment when EU leaders have a chance to take the lead and instruct Barnier to take a more flexible approach or send the UK back to the drawing board.” So far, the markets are taking the news in its stride and the pound remains weak while consolidating this week’s sell-off from the 1.3240s down at 1.3050. The cross is also consolidating and is currently in the 0.8920s EUR/GBP levels Higher highs keep the bullish trend on track on Tuesday. The 10-D SMA was coming in as a firm support yesterday and has moved up with the price action to 0.8854, (yesterday’s lows 0.8843). On a break above 0.8960 and then 0.8980, the 0.9034 October 2017 high on the wide is a key upside target. To the downside, the 10, 200 and 21-D SMAs guard 0.8720 triangle lows and the double bottom lows at 0.8697. 0.8620 protects a run towards 0.8526 as being the 78.6% retracement of the move from 2017 on the wide. FX Street FX Street FXStreet is the leading independent portal dedicated to the Foreign Exchange (Forex) market. It was launched in 2000 and the portal has always been proud of their unyielding commitment to provide objective and unbiased information, to enable their users to take better and more confident decisions. View All Post By FX Street FXStreet News share Read Next USD/CAD Technical Analysis: USD/CAD erases daily gains and drops below 1.3200 figure FX Street 5 years The 10-D SMA was coming in as a firm support yesterday and has moved up with the price action to 0.8854. On a break above 0.8960 and then 0.8980, the 0.9034 October 2017 high on the wide is a key upside target. The pound was the weakest currency as North America traders walked in due to the inflation data as well as miss PM May's weak hand in the Brexit negotiations, both of which make for dwindling prospects of a rate hike from the BoE as soon as August. 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