Sterling Falls to One-Week Low, But May’s Request for Delay Could Slow Bears

Technical analysis of Forex market

Cable fell to one-week low at 1.3146 on Wednesday, as renewed risk of no-deal Brexit keeps the currency under pressure.

Several scenarios remain on the table and keep high uncertainty in Brexit drama, as PM May asked the EU for three-month extension of Brexit deadline, in attempts to buy some time and try to adjust her plan that the parliament will finally approve after recent double rejection.

PM May wants Britain to leave the EU in an orderly manner and extension of the deadline would give her more space to work on plan modifications, as well as to try to convince the lawmakers.

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Break below converged 10/20SMA’s weakens the structure, but confirmation requires close below to signal further weakness.

Close below 10/20SMA’s would risk extension towards 1.3120/95 (Fibo 61.8% / 30SMA and would unmask key 200SMA support (1.2984).

On the other side, renewed optimism over possible Brexit delay (though there is strong opposition to the scenario from France), may reduce immediate bearish pressure, but downside is expected to remain at risk while 1.33 resistance zone stays intact.

Res: 1.3220; 1.3272; 1.3310; 1.3330
Sup: 1.3192; 1.3182; 1.3146; 1.3120

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