Brexit Latest: News, Updates and Sterling Technical Analysis
- PM May looks for the support of Parliament.
- Sterling continues to nudge lower, seeking out support.
We have recently released our Q1 2019 Trading Forecasts for a wide range of Currencies and Commodities, including GBPUSD along with our latest fundamental and medium-term term technical outlook.
Sterling (GBP) Hits a One-Month Low Against the US Dollar
The British Pound continues to probe lower, looking for meaningful support against a strong US dollar. With around six weeks to go until the UK leaves the EU, indecision and negative sentiment is starting to show in GBPUSD with the pair hitting a one-month low and now trading below all three moving averages. Later this evening, UK PM May will ask for support from MPs in the House of Commons as she looks to re-invigorate talks with the EU and get a concession on the Irish backstop. While PM May expects a tough ride from the EU, who have repeatedly said they will not budge on this issue, the Prime Minister may get an even harder time from Eurosceptic MPs in Parliament who want her to rule out taking No Deal off the table, which many fear she is steering the negotiations towards. Others feel that the PM is ‘running down the clock’ leaving the UK with the option of either No Deal or PM May’s unpopular current deal in a hope of bouncing MPs into the latter. Either way, the British Pound is finding any upside traction difficult and is likely to slip lower as Brexit noise ramps up.
GBPUSD Daily Price Chart (June 2018– February 14, 2019)
IG Retail Sentiment data shows clients are 65.9% net-long GBPUSD, a bearish contrarian indicator. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger GBPUSD bearish contrarian trading bias.
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--- Written by Nick Cawley, Analyst
To contact Nick, email him at nicholas.cawley@ig.com
Follow Nick on Twitter @nickcawley1
