Pound gains pared back as buyers lose some momentum from earlier today
GBP/USD falls back to 1.3200 and tests the 100-hour moving average
As the dollar eased earlier, cable hit a session high of 1.3243 but is quickly seeing that reverse towards 1.3200 and a test of its 100-hour MA (red line) at the figure level now.
Despite the dollar holding slightly weaker on the more positive sentiment in the equities space, the pound itself is facing some considerable risks this week with Brexit negotiations in Brussels having the potential to still lead nowhere over the next few days.
Headlines such as this and this only serves as a constant reminder to the market that there is still that possibility of a no-deal Brexit outcome.
For now, cable buyers are challenged to try and keep the more bullish near-term bias on a test of the 100-hour MA. Keep above and the bias stays that way but break below and the bias will then turn to being more neutral instead.
Further support is then seen closer to the 200-hour MA (blue line) @ 1.3156.
Source: Technical analysis