Cable was sharply lower on comments from UK PM May who confirmed that the deal with EU is the final one and the UK is leaving the union in March, as scheduled.
May also pointed to comments on the second vote as attempts to frustrate Brexit process.
The latest comments soured pound’s sentiment and fresh weakness retraced over 61.8% of Wednesday’s rally, neutralizing positive impact from weaker dollar on Fed’s Powell dovish stance.
Larger bears are returning to full power after initial bullish signal was generated on Wednesday’s close above 10SMA (1.2810).
Bearish daily studies add to negative outlook, with strong supports at 1.2722/32 zone (15/27/28 Nov lows) coming under pressure and break would unmask key supports at 1.2695 (30 Oct) and 1.2661 (2018 low).
Initial resistance is provided by 10SMA (1.2810) which should ideally cap and maintain bearish bias.
Highs of Wed/Tue (1.2849/47) mark next pivots, violation of which would provide relief, but sustained break above1.2895 (Fibo 38.2% of 1.3174/1.2722 / converged 20/30SMA’s) is needed to neutralize bears and confirm double-bottom (1.2722/25).
Brexit remains pound’s key driver and focus turns towards 11 Dec when the UK parliament is going to vote on Brexit plan.
Res: 1.2810, 1.2849, 1.2863, 1.2895
Sup: 1.2757, 1.2722, 1.2695, 1.2661
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