Cable holds firm tone in early Tuesday’s trading, hours ahead of parliamentary vote on Brexit deal. Monday’s Doji candle and failure to clearly break above pivotal barriers at 1.2877/1.2894 (Fibo 61.8% of 1.3174/1.2397/100SMA) signals that bulls might be running out of steam. South-turning 14-d momentum and converged daily Tenkan-sen/Kijun-sen in sideways mode add to negative signal. The UK parliament is widely expected to vote down PM May’s plan today, suggesting that this should not be a big surprise for traders, however, markets are expected to focus at the grade of defeat that could be a major driver of sterling today. If May’s plan loses more than a hundred votes, this would be additional negative signal for pound which could accelerate below 1.2600 support in post-vote knee-jerk reaction in highly volatile market. Alternative scenario requires sustained break above 100SMA / 30WMA and daily cloud top to generate strong bullish signal for extension through psychological 1.30 barrier at possible extension towards falling 200SMA (1.3120).
Res: 1.2894, 1.2933, 1.2958, 1.3000
Sup: 1.2855, 1.2804, 1.2776, 1.2726
