GBP/USD pulls back from monthly high amid UK’s political uncertainty

• GBP/USD refrains from breaking the monthly high amid the UK’s political pessimism.
• British Chancellor’s canceled speech fuelled speculation of an early election.
• Cross-party MPs agree to block a no-deal Brexit, pledge for alternative parliament in a case of prorogation.

While receding odds of a no-deal Brexit propelled the GBP/USD pair to a monthly high on Tuesday, prices fail to hold on to recovery gains as registering a pullback to 1.2285 during early Wednesday.

The Guardian and the Huffington Post both cite speculations of an early general election based on the UK Finance Minister’s surprise cancellation of the press conference concerning the announcement of an annual spending plan. In a separate news report, The Guardian raises doubts over the UK Government’s capacity to come up with a workable solution for the Irish backstop even if the EU is ready to discuss the sticking point.

Previously, British Members of the Parliaments (MPs) pledge to form an alternative parliament in case the UK Prime Minister (PM) Boris Johnson prorogues the present one. The opposition Labour party leader Jeremy Corbyn now urges Tory rebels to support his cause to block the no-deal Brexit.

On the other hand, fears of the global slowdown and the US-China trade war fail to tame the US Dollar (USD) amid upbeat data.

Investors will now keep an eye over the PM Johnson’s Chief Brexit adviser David Frost’s visit to Brussels for fresh political headlines.

Technical Analysis

The 1.2372/82 area comprising 50-day simple moving average and July 17 low becomes the key upside barrier while 1.2200 holds the pair’s declines confined.