13:02, 26 March

Remains Around Key 1.32 Level as Brexit Process Removed from PM

In the last couple of days the GBPUSD has been able to rally a little and keep within touch of the key 1.32 level where it spent most of the last few weeks trading around. In this same period the GBPUSD has increased in volatility but kept right around the 1.32 level. Several weeks ago the GBPUSD fell sharply from an eight month high back down below the key level of 1.32 before rallying again and reaching a nine month high a couple of weeks ago. 
Late February was significant as the sterling moved so strongly breaking through the key level for the first time in many months on its way to the eight month high. The other key level presently is 1.27 which is some distance away, however it has supported the currency pair well in recent months.

The sterling enjoyed a very positive January as it has moved from below 1.27 up to a three-month high at the resistance level around 1.32, before a subsequent decline. Starting in mid-December, the GBPUSD had slowly but steadily climbed higher from a two year low below 1.25 up to the current key level of 1.27 and beyond. As expected, it met some resistance from the 1.27 level at the end of last year as multiple attempts to push higher were thwarted and now that it has cleared, you could expect the pound to receive some support from this level should it be called upon.

In early December, the 1.27 level gave way to immense selling pressure, after the sterling was again enjoying much needed support from this level as it had firmly established as a key support level as the currency pair had enjoyed considerable support from this level on several occasions in the few months prior. Should the GBPUSD drop through the support at this level, then it could fall considerably further with no obvious support levels nearby.

Embattled British Prime Minister Theresa May under growing pressure to her leadership and scrambling to win over opponents to her Brexit withdrawal plan, has has the process removed from her control.  United Kingdom lawmakers have voted to take control of the Brexit process away from the PM's ailing government.  Working late into Monday night, British MPs voted to pass an amendment proposed by a cross-party group of lawmakers in the hope of finding a Brexit solution. The measure passed with 329 votes in favor of the proposal and 302 voting against.  The passing of the “Letwin amendment” looks to change the rules of Parliament, allowing lawmakers to set a timetable for debate and subsequent votes on alternative outcomes for Brexit. On Wednesday this week, MPs are now expected to control business in the House of Commons in order to hold the series of votes on different Brexit outcomes. This takes the power away from the government and allows MPs to put forward business motions relating to the U.K.’s departure from the EU.