Technical Analysis – GBPUSD retraced from psychological resistance.

Following our last week’s report on GBPUSD, it further its gains
towards the support-turn-resistance near 1.3000 psychological level from March
this year. However, the pair lost its upward momentum and retraced from its
high levels back to 1.2850 level. If the pair breaks below its 1.2800 support,
a further retrace towards the 18EMA can be expected.

In terms of indicators, MACD, currently losing its bullish momentum,
with a possible death cross formation, if it continues to falls lower. Until
further confirmation can be obtained, such as a breakout below the 1.2800
support or previous high levels, no clear direction can currently be obtained
except expectations of consolidation.

From the fundamental point of view, the GBPUSD was able to hit a
5-months high supported by the success of Brexit deal getting passed, with the
result of the vote at 329-299. However, the pound lost its upward momentum
after UK PM Johnson put the entire legislation on hold after the Parliament
rejecting his motion program, which aimed at approving a Brexit deal in 3-days
time. Parliament argued that a longer time is required to go through the
agreement thoroughly before deciding on such an important matter.

On Thursday, PM Johnson called for an election on December 12,
claiming that if he wins a majority, he will be able to ratify the Brexit deal
if it continues to be delayed. He urged the opposition Labour party to back the
election and threatened to go on a strike if they reject. However, Labour Party
leader Jeremy Corbyn stated that he is willing to go with an election, provided
that a no-deal Brexit is off the table. EU27 is expected to answer the request
of Brexit extension over the weekend. EU27 decision remains crucial, if they
decided to provide a shorter extension, PM Johnson might revoke his decision
for an early election, allowing Parliament sufficient time to pass the Brexit
deal.

Crucial week ahead for Brexit progress.