Cable moved higher as PM May spoke in early European trading on Friday, mainly consolidating after Thursday sharp 1.67% fall, following news of resignation of the Brexit minister in the UK government.
May had nothing significantly new to say, but finalizing the deal which will be presented to the parliament on 25 Nov, and also expressed expectations that EU will respect UK citizens in case of no-deal scenario.
Resignation of Brexit minister was the last of a series of bad hits to the UK government, which is also strongly pressured by the opposition over Brexit talks that repeatedly stalled, just few months ahead of divorce date.
Adding to negative outlook was rejection of a cabinet member to say whether PM May has support from her cabinet or not.
The most recent events increased pound’s negative sentiment, with bearish daily/weekly techs and Thursday’s massive bearish daily candle, weighing heavily and maintaining bearish bias.
Risk remains at the downside, as Thursday’s fall approached the first of two key supports at 1.2695 (30 Oct low), violation of which would expose next pivot at 1.2661 (15 Aug low) and signal continuation of larger downtrend from 1.4376 (2018 high) on break.
Meanwhile, recovery attempts were so far capped by previous low at 1.2827 (12 Nov), with potential stronger upticks expected to stall under falling 20SMA (1.2918) and keep bears intact.
Markets will be watching for news about Brexit, recent key driver of British pound, to get fresh signals.
Res: 1.2833, 1.2874, 1.2918, 1.2966
Sup: 1.2760, 1.2722, 1.2695, 1.2661
