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Sep 10 - 10:55 PM

GBP/USD - COMMENT-Sterling To Pause For Breath Amid Brexit Turmoil

By Content Admin  —  Sep 10 - 08:45 PM

A tough week for sterling as soured Brexit deal expectations weigh, but upcoming key support and oversold technical signals suggest a short-term respite.

UK-EU trust hit all-time low's for Brexit negotiations as the UK government insists on rewriting the Withdrawal Agreement nL8N2G713X.
The Times carries a story saying that dozens of Conservative law makers are preparing a revolt on the issue Click here , but even if successful, it would not heal the rift in trust between the negotiating teams.

Cable has fallen 3.6% and EUR/GBP is up 3.6% from Friday's NY close, so this has been a sterling move.
The Morgan Stanley FX Positioning Tracker on September 7 showed the largest longs in the G10 were held in EUR and GBP, so unwinding stale GBP longs likely a major factor.

Technically for cable, 5, 10 and 21 daily moving averages are falling, as 21 day Bollinger bands expand, which is a bearish setup.
Cable is poised above significant support at 1.2721-1.2137, being 61.8% June-September rise and the 200 daily moving average.
Meanwhile the lower 21 day Bollinger band, which is a very good indicator of an oversold market comes in at 1.2831.

The charts suggest that cable may pause for breath, which favours selling bounces rather than breaks.

For more click on FXBUZ


gbp sep 11 Click here

Source:
Refinitiv IFR Research/Market Commentary

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