Immediately after publishing yesterday's report, the GBP/USD passed support levels and extended its decline as low as 1.2160.
The move was fundamental, as Boris Johnson made request that would neutralize interference into Brexit by the UK Parliament. In general, on Thursday morning the rate had already consolidated the decline and resumed to trade downwards.Pound depreciates on possible Parliament suspension
On Wednesday morning, August 28, the British Pound depreciated 129 pips or 1.05% against the US Dollar.
The reason for the drop is a possibility that the UK Queen Elizabeth could be asked to extend the UK Parliament break until October 14.
Previously, the British Prime Minister Boris Johnson said that the UK would leave the European Union with or without a deal on October 31. Thus, a possible Parliament suspension might be a part of the UK Government campaign to get Brexit done.
Economic Calendar
On Thursday, at 12:30 GMT the US Preliminary GDP is scheduled to be published. The event has caused moves on GBP/USD charts from 8.0 to 16.7 pips since February.
GBP/USD short-term review
On Thursday morning, the rate declined below the 200-hour SMA. Due to that reason it had no technical support as low as the 1.2141 level.In theory, the rate should decline to that level. However, take into account that the 1.2150 round level could provide support.
Hourly Chart
On the daily candle chart, the rate has bounced off the resistance of a dominant channel down pattern.
Moreover, the rate is being forced into a decline by the resistance of a weekly pivot point at 1.2220.
If the rate trades consistent with the pattern, it is set to decline in the borders of the pattern until the end of September.
Daily chart
Read More: Technical Analysis
Traders remain long on GBP/USD
By the middle of Wednesday's trading session, 60% of open position volume on the Swiss Foreign Exchange was in long positions.
On Thursday morning, the sentiment was 61% long. Despite the drop, traders have remained long on GBP/USD.
Meanwhile, trader set up pending orders in the 100-pip range were bullish, as 63% of orders were set to buy and 37% were to sell.
The orders previously were close to neutral.
By the middle of Wednesday's trading session, 60% of open position volume on the Swiss Foreign Exchange was in long positions.
On Thursday morning, the sentiment was 61% long. Despite the drop, traders have remained long on GBP/USD.
Meanwhile, trader set up pending orders in the 100-pip range were bullish, as 63% of orders were set to buy and 37% were to sell.
The orders previously were close to neutral.