Pound strengthens on Brexit delay hopes

Intermediate
  • A firm push higher for Sterling over the past 24 hours as rumours abound that UK Prime Minister Theresa May is opening up discussions within the Cabinet, on Tuesday 26th February, for a delay to the UK’s date for leaving the EU, currently set at 29th March 2019.
  • This is seen as a positive for the GB Pound, as it makes a no deal Brexit less likely, which is broad seen as harmful for the UK economy.
  • Here we focus on the upside risks for the Pound versus the US Dollar, the GBP/USD or Cable forex rate.

GBPUSD bull threat to key 1.3218

A solid consolidation Monday and then a firm push higher above 1.3109 resistance, after Friday’s dip and a rebound from just above our 1.2960 support (off of 1.2967), sustaining positive forces from last week’s surge, leaving a positive tone within the broader, intermediate-term range and risks higher into Tuesday,

We see an intermediate-term range as 1.2668 to 1.3218, BUT with growing risks for an intermediate-term bullish shift above 1.3218

For Today:

  • We see an upside bias for 1.3149 and 1.3169; break here aims for key 1.3218 and then maybe towards 1.3236 and 1.3258.
  • But below 1.3049 opens risk down to 1.3006/00.

 Intermediate-term Range Breakout Parameters: Range seen as 1.2668 to 1.3218.

  • Upside Risks: Above 3218 sets a bull trend to aim 1.3299 and 1.3473.
  • Downside Risks: Below 2668 sees a bear trend to target 1.2437 and maybe towards 1.2000.

4 Hour Chart

GBPUSD Chart 2019-02-26

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