GBPUSD Technical Analysis and Key Levels
The GBP saw some demand on mounting hopes that Brexit could be extended past March 29, although no official word came on it. In the meantime, seven Labour MPs quit their party to form an independent group amid divergences with Corbyn’s latest stance. Meanwhile, the EU reiterated that the Brexit withdrawal agreement is not open to negotiations, neither they can provide legally binding changes to the Irish backstop. UK PM May should deliver a deal by February 27. If she can´t, the Parliament would vote on taking over Brexit process, and May expects them to order her to seek an extension of negations warning lawmakers that this will be their last chance to avoid a no-deal Brexit.
UK Macro Economic Calendar:
This Tuesday, the UK will release its latest employment data, with the ILO unemployment rate for the 3 months to December seen steady at 4.0, and average earnings are seen up in the same period, quite an encouraging sign considering inflation fell below 2.0%. Also, the number of people seeking the unemployment benefits in the UK is foreseen at 2.4K in January, down from 20.8K previously.
U.S. Economic Calendar does not offer anything interesting.
The market players will be focusing on Brexit Headlines, UK Average Earning Index and Employment Data.
On the H4 Chart, Cable is trading in the upper Bollinger Channel but could not close above EMA 50 and SMA 200. RSI is at the neutral territory.
1.29400 is the key resistance. A better than expected UK Data could help Cable to break above 1.29400.
On the downside, the key support resides at 1.2878 and 1.28500.
Cable bulls will not leave the game and try to keep the pair above 1.28500.
The only emerging harmonic pattern is a potential Bullish Alternate Bat.
Bullish Bat has been completed at 1.2898 and Alt Bat – 1.13 Extension – would be completed at 1.28800.
As we have published yesterday:
Fresh Long Opportunity at the breakout of 1.29400.
The Setup of the Bat Pattern:
Long Area of the Entry: 1.2900 – 1.22800
Stop: Below 1.28500
Targets: 1.29200 & 1.29380 / Targets Reached.
Update: We wait for UK data. Breakout of 1.29400 would trigger the Bullish Move.
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