- Political uncertainty surrounding the UK seems less observed ahead of the British parliament’s re-open on April 23.
- The US data will be in the focus for determining near-term trade direction while 200-day SMA will be a crucial support to watch.
The British Pound (GBP) is taking the rounds near 1.3000 mark versus the US Dollar (USD) during early Monday. The GBP/USD pair recently bounced off 200-day simple moving average (SMA) despite negative Brexit headlines and Easter Monday holidays at the majority of global markets.
Recently, the Sunday Times’ report conveyed that the senior conservative leader is set to tell the UK Prime Minister Theresa May to quite her position while the BBC said that the opposition Labour party is promoting another Brexit referendum as a selling point for their EU election pitch. Both these news reports are portraying pessimism surrounding the Brexit.
However, traders reacted positively to the news and triggered the pair’s pullback from 200-day SMA.
There could be various arguments ranging from the initial reaction to Friday’s US housing market numbers to the traders’ speculations ahead of the UK parliament’s open on April 23 that justify the move.
Moving on, March month figures of the US Chicago Fed National activity index and existing home sales could entertain the Cable traders on an otherwise dull day for trading. The housing market indicator may flash another downbeat figure whereas activity index was in the negative territory during the latest release.
GBP/USD Technical Analysis
Despite bouncing off the important SMA, the pair needs to surpass 1.3050 and a descending trend-line stretched since March 13, at 1.3070, in order to confront 50-day SMA level of 1.3100. If at all prices rally beyond 1.3100, the current month high near 1.3135 can flash on buyers’ radar.
Alternatively, 200-day SMA level of 1.2970 and 100-day SMA near 1.2955 can act as immediate rest for the pair, a break of which can recall 1.2930, 1.2910 and 1.2880 support back on the chart.
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