Release Time:2019-02-18 09:32
GBPUSD (1.2821) • UK Retail Sales rose 1.2% in Jan, reversing the 1.0% M/M decline posted in Dec. Stronger data gave the GBP a modest lift from intraday lows but the over-arching concern for the GBP remains the state of play in Brexit. Last Thursdays developments in Parliament underscored PM May’s weak position, mainly because of the “hard Brexit” contingent of her own party. While thursdays vote defeat means little from a procedural point of view, it should be clear to the EU that there is little hope of attaining a Conservative majority for any Brexit deal. Brussels’ focus may pivot to trying to establish a cross-party base for a customs union arrangement.
GBPUSD short-term technicals: bearish – After solid gains through the New Year period, the GBP has eased for three consecutive weeks – assuming a likely lower close on the week through today. The market has lost around half of the gains seen through Dec and early Jan and may consolidate around the 1.28 point in the short run. Trend signals have turned adverse on the short, medium and longer run studies, however, and this suggests strong selling pressure is likely to emerge on minor gains. We spot resistance at 1.2900 intraday. Support is 1.2775/85.