Supported by several factors GBP/USD bounced on Monday
Easing hard Brexit fears resulted in short-covering moves
US Dollar weakness continued prior to a key MP’s vote in the House of Parliament.
The GBP/USD pushed higher hitting the daily high around 1.1850 early on in the European session.
Sterling experienced short-covering moves on Monday prior to the key MP’s vote on the Internal Market Bill in Parliament. The bill has come under fire and drove fears that Brexit trade talks would collapse.
However, reports suggest that opposition parties could prevent the legislation from moving through the house. Ex-Prime Ministers Tony Blair, and Sir John Major advised MPs to vote against the bill, which attempts to undercut parts of the UK’s Brexit divorce bill with the EU.
GBP/USD rebounded from the key 200-day SMA and is holding steady at the two-week-old bearish trajectory. US Dollar weakness is adding support to the pair. The US Dollar remains under pressure over questions surrounding additional fiscal stimulus.
Brexit developments will continue driving the Pound, particularly in the absence of high impacting economic data from the UK or the US. GBP/USD may be able to capitalise on momentum, although this remains to be seen.
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