May defeated in House of Lords

On Monday evening, the UK House of Lords voted an amendment to enable the UK parliament for a meaningful vote on Brexit. The vote constitutes another defeat for Theresa May’s government which will have to face a second vote about the same issue in the House of Commons. Pro-EU rebels could be voting in favor of the amendment, providing instability for Theresa May’s government. Markets seem to be in a wait and see position currently, but further negative headlines could weaken the pound.

GBP/USD continued to move in a sideways manner on Monday and during today’s Asian morning between the 1.3215 support line and the 1.3330 resistance line. We could see the pair continue its sideways movement today, however the pair may be under higher volatility if there are headlines about tomorrow’s vote in the House of Commons and Brexit. Should the bulls take over we could see it breaking the 1.3330 resistance line while should the bears be in charge, we could see it clearly breaking the 1.3215 support line and aim for the 1.3125 support level.