A bit of a dollar pull but it’s mostly the pound being offered in early trades
The pound has now fallen below the kiwi in being the worst performing major currency on the day as cable falls to a low of 1.3042 on the day. Sellers leaned on the 100-hour MA (red line) since overnight trading and found conviction to drive price towards near-term support around 1.3040 as well as the 200-hour MA (blue line) @ 1.3031.
Cross-party Brexit talks continue to yield no new progress – even though expected – and that certainly doesn’t add much positive headlines for the pound to act upon currently.
That said, unless price breaks below the 200-hour MA, it’s hard for sellers to justify a further extension to the downside just yet. As it stands, we’re likely set for a month of Brexit limbo given that UK lawmakers are pretty much resigned to the fact that they would have to partake in the coming European Parliament elections already.
Hence, if you’re going to be trading the pound, stick to the charts and go with what price action is telling you because Brexit sentiment will be of little help over the next few weeks.
As for today, keep an eye out on the near-term support levels highlighted above. If they give way, sellers will regain near-term control and look for a move lower towards 1.3000.