GBP/USD remains under pressure near 1.3030 on Brexit uncertainty

Forex Distribution
  • Brexit disappointments keep weakening the GBP/USD pair as British lawmakers continue to raise barriers for an orderly exit.
  • The economic calendar could also gain market attention for fresh impulse.

GBP/USD trades around 1.3030 during the early Asian session on Monday. The quote seems struggling to extend its late-Friday recovery as Brexit headlines over the weekend haven’t been positive after the UK parliament turned down the PM Theresa May’s third proposal. In addition to the political developments surrounding the Brexit, headline data from the UK and the US will also gain market attention.

British lawmakers again rejected PM May’s withdrawal agreement proposal for a third time by a margin of 344 to 286 votes on Friday. The EU made clear in its latest summit held a few weeks back that the UK parliament needs to support the Brexit agreement finalized with the PM May in order to avail an extension of the Brexit date from April 12. In absence of doing so, the UK lawmakers face brighter chances of witnessing a hard Brexit on April 12.

However, some among the British parliament members (MPs) are trying to bridge the gap between what the UK lawmakers want and what the EU is ready to pay by proposing Brexit amendments that have previously been turned down and are likely to be voted again on Monday.

Recently, the EU Commission chief Jean-Claude Juncker recently spoke on an Italian TV show that the European Union has had a lot of patience with the UK over Brexit which is running out and would like the UK to be able to reach an agreement soon.

On the other hand, some of the MPs are preparing for a coup to topple PM May from her seat while others are building support for Brexit indicative votes. Hence, politics surrounding the Brexit will continue to be a major catalyst for the GBP/USD pair.

In addition to the Brexit, Monday’s economic calendar also has some important data for GBP/USD traders to watch. Among them, March month figures for the Markit/CPIS manufacturing purchasing managers’ index (PMI) for the UK will be the first one. The British manufacturing gauge may soften to 51.3 from 52.0.

At the US front, February month retail sales and ISM manufacturing PMI for March month will be closely observed. The retail sales control group growth may slow down to 0.4% from 1.1% whereas the ISM manufacturing PMI could strengthen to 54.5 from 54.2 earlier.

GBP/USD Technical Analysis

While 200-day simple moving average (SMA) figure of 1.2980 acts as immediate downside support, 50-day SMA figure of 1.3095 could confine nearby advances of the quote. Should prices slip under 1.2980, 100-day SMA level of 1.2925, followed by 1.2900, can please sellers whereas an increase beyond 1.3100 round-figure may again highlight 1.3180 and 1.3230 on the chart.

Original article written by Anal Pinchal at FXStreet