Pound Pulled Back After Key Minister Quit

By: Eddy Peng Jul 10, 2018
The British pound fell, reversing earlier gains since late last month, as U.K. Prime Minister Theresa May may face a leadership challenge in the Brexit process. Pound pulled back 20.49 basis points, or 0.19 percent on Monday, from the session high since mid-June. May has been stuck in her Brexit plan and battled to stave off a full-blown crisis after three ministers quit within 24 hours to protest her plan. The resignation of Foreign Secretary Boris Johnson, the campaign to leave the European Union in 2016, compounded the chaos in government following the departures of Brexit Secretary David Davis and his deputy late Sunday. May’s statement to Parliament on Brexit, which was supposed to crown a rare compromise deal reached with her divided Cabinet on Friday, was turned into a two-hour defense of her policy of seeking a softer way to leave the EU. From the technical perspective, we could see a potential reversal in the GBP/USD for a broader outlook as a positive divergence occurred in MACD and RSI indicators. In this case, a long-term upswing may occur if it breaks out the resistance near 1.333 (38.2% retracement). However, if the pair continues to edge lower and even breaks through 50.0% retracement later, a higher pressure will push the pair down further. ACY-GBPUSD-Daily-100718 Pound Pulled Back After Key Minister Quit

Chart 1: GBPUSD Daily

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