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The FxPro Analyst Team

GBP/USD Hits a 7-week low on Second Brexit Defeat in Lords

Yesterday the House of Lords has voted against a second Brexit referendum, by 336 votes to 131.

The House of Lords also voted on an amendment that would empower the UK Parliament to vote on the final Brexit deal which Theresa May agrees with the EU, by 366 votes to 268.

That is to say, if the UK parliament is not satisfied with the final Brexit deal, they can vote to reject it and force the UK PM Theresa May to renegotiate with the EU.

Theresa May and the Tories faced the second embarrassing defeat in Lords over the final Brexit bill.

The amendment will be sent to the House of Commons, and vote for approval or rejection next week.

GBP/USD hit a 7-week low of 1.2138 this morning.

The GBP/USD bears has pushed the price lower since 3rd Mar, with trading below the downtrend line resistance.

Early this morning, GBP/USD bulls failed to recover the significant support line at 1.2200. The increased bearish momentum further broke the next support line 1.2170.

The zone between 1.2120 – 1.2140 will likely provide a stronger support.

However, if the zone fails to hold the downtrend, the price will likely be pushed lower and test the next significant support line at 1.2100.

The price is still trading along the lower band by the Bollinger Band indicator, suggesting the current trend remains bearish.

The resistance level is at 1.2170, followed by 1.2185 and 1.2200.
The support line is at 1.2150, followed by 1.2140 and 1.2120.

Before the final decision on the Brexit bill is made, be aware of downside risk on Sterling and Sterling crosses caused by political uncertainty.

Keep an eye on the US ADP employment change in Feb, will be released at 13:15 GMT today. It will be followed by the release of the US unit labour costs and non-farm productivity in Q4.
With better-than-expected figures, it will likely weigh on GBP/USD and test support lines.
With weaker-than-expected figures, it will likely push GBP/USD up and test resistances.

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