On Tuesday, the volatility caused by Brexit announcements was massive. During the morning hours the rate had jumped up almost touching the 1.3300 level. Afterwards, by the middle of the day, the rate had fallen down to the 1.3000 level.
An almost three hundred pip move had happened during a couple of hours. This rate remains still highly volatile due to politics that affect the future economic strength of the United Kingdom.
Most technical can be ignored today, as the UK Parliament will vote on the Brexit once more.
Minor data in Brexit's background
This week is unusual. The majority of the notable macroeconomic events take place at the start of the week.On Tuesday, at 12:30 GMT the US Consumer Price Index and Core Consumer Price Index will be published.
The week's important events will end already on Wednesday. At 12:30 GMT the US Durable Goods Orders and the US Producers Price Index will be released.
For more information watch the weekly calendar analysis stream on our YouTube channel.
Click Here: Economic Calendar Analysis
GBP/USD short term review
During the previous trading session, the British Pound skyrocketed to 1.3250 breaking most of the technical indicators. On Tuesday morning, the currency exchange rate was depreciating towards the previously drawn pattern line to be located at the 1.3147 mark.It is expected that the 100-hour simple moving average and together with the monthly pivot point support level will push the rate towards the 1.3200 level.
On the other hand, today's US Consumer Price Index and Core Consumer Price Index data release at 12:30 GMT might depreciate British Pound against the US Dollar to push the rate to return to the previously drawn pattern at 1.3000.
Hourly Chart
On the daily chart the recent moves have been consistent with a dominant ascending pattern. The rate is retracing downwards in the borders of it.
Previously, it was stated that the decline will reach the 1.3000 level. That target has been touched.
However, there is still more room for a decline. Namely, the 1.2920 level could be reached during the near future.
Daily chart
Read More: Technical Analysis
Sentiment remains unchanged
Traders continue to mostly short the GBP/USD. On the Swiss Foreign Exchange of the total open position volume 57% was short since Monday.
Meanwhile, the pending orders were neutral. 57% of pending commands in the 100-pip range were set to buy the GBP/USD.
The traders, who were short since Monday, were taking in nearly 300 pip profits.
Meanwhile, the pending orders were neutral. 57% of pending commands in the 100-pip range were set to buy the GBP/USD.
The traders, who were short since Monday, were taking in nearly 300 pip profits.