Media reports suggested that EU chief Brexit negotiator stated that Britain is running out of time, if it wants to avoid a hard Brexit. The EU seems to aim the end of October as a deadline for an agreement with the UK for their post Brexit relationships. On other news Theresa May seems to deliver a preemptive strike to the EU draft deal which is set to be published on Wednesday. Also, pressure seems to be piling for May, as 8 Torie parliament members rebel as they prefer to remain in the customs union. Negative headlines are expected to continue to appear and could weaken the pound.
Cable traded in sideways manner yesterday, testing the 1.3850 support line, during Powell’s testimony. We see the case for the pair to continue to trade in a sideways manner for the next couple of days, with some bearish mood as positive USD sentiment may continue. However, it should be noted that the pair is approaching the upward trend line incepted since the 13th of January. Should the pair find fresh buying orders, it could break the 1.4040 resistance level. Should it come under selling interest, we could see the pair breaking the 1.3850 support level and aim for the 1.3750 support barrier.