Pound weakening against weak dollar as Brexit woes continues

Pound holding at resistance, can it test 1.25?

Technical Overview: Pound currently trading at 1.2695 which trading below the downward channel support 1.2700, currently trading below the psychological level 1.27 and below the key support 1.2680 which turned to resistance now. A break upside 1.2750 can check 1.2830/2850 further. Downside support lies at 1.2515 (Jan 03rd low). One can enter sell in every rise for downside said levels which could be a good strategy for the day until it stays above 1.2800 for upside said targets.

Fundamental: May stepped down as leader of the ruling Conservative Party on Friday, having failed three times to win parliament’s support for a European Union divorce deal that was supposed to steer the country smoothly out of the bloc and deal with Britain’s biggest political crisis in a generation. Boris Johnson remains the odds-on favourite to be Britain’s next PM. Nine other Tory MPs are vying to succeed May: first round of voting Thursday. Second to fourth rounds next week, before top two run-off. GBP could rise if Johnson fails to make run-off. Finally, EU won’t renegotiate the Brexit deal – UK politics in turmoil. Increasing fears of no Brexit deal amid rising political uncertainties might continue to limit the gains.

Suggestion: SELL GBPUSD TILL 1.2700 FOR 1.2620/2600 ELSE BUY ABOVE 1.2780 FOR 1.2850/2880

Important levels to watch:

Support Levels

S1: 1.2630 S2: 1.2600 S3: 1.2580

Resistance Levels

R1: 1.2660 R2:1.2680 R3: 1.2700

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