GBPUSD Eyes Support as UK Parliament Rejects Brexit Alternatives

GBP/USD, Brexit Talking Points

• GBP/USD tumbles, the UK Parliament rejects Brexit alternatives again
• Votes are non-binding, UK still risks crashing out of the EU on April 12
• Sterling is eyeing the critical rising trend line from December as support

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The British Pound tumbled almost 0.7% (see chart below) after the UK House of Commons voted and rejected all motions for alternative Brexit arrangements Monday evening. This followed a similar round of voting in Parliament last week where no single substitute to UK Prime Minister Theresa May’s divorce deal managed to gather a majority. Her withdrawal deal has been rejected three times.

Arrangements that were put on the floor today that failed to receive enough ‘aye’ votes included the UK staying in the customs union, the single market, or a second referendum. Following the results, lawmaker Nick Boles quit the current government lead by Mrs May after his alternative plan for Brexit, a Norwegian-style arrangement that incorporates being in the single market, was rejected.

As a reminder, these votes are non-binding which means that by default, the UK will have to leave the European Union after the unconditional withdrawal deadline was extended to April 12th. This is despite MPs voting largely in favor of crashing out of the EU without a deal of any sort. The Prime Minister is running out of time as the risks of a ‘no deal’ have increased and calls for another general election are simmering.

GBP/USD 15-Minute Chart Reaction to Brexit Latest

Chart Created in TradingView

GBP/USD Technical Analysis

On the daily chart below, GBP/USD finds itself sitting right above a critical rising trend line from December. It is running out of room to consolidate in between that in a falling range of resistance from its peak in March. Clearing support does entail passing through a range between 1.3012 and 1.2952 which has held up at this point. You can follow me on Twitter for the latest updates on GBP/USD and Brexit here at @ddubrovskyFX.

GBP/USD Daily Chart

Chart Created in TradingView

British Pound Dollar Trading Resources

• Just getting started? See our beginners’ guide for FX traders
• Having trouble with your strategy? Here’s the #1 mistake that traders make
• See how the British Pound is viewed by the trading community at the DailyFX Sentiment Page

--- Written by Daniel Dubrovsky, Junior Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter