Daily Briefing, March 14 – Trading EUR/GBP & GBP/USD, Brexit Vote in Focus
Arslan Butt • 2 min read
Good morning, traders.
The Brexit drama is still on as the UK MPs shocked the government and voted by 312 to 308 to reject a no-deal Brexit under any situation. In response, the GBP/USD pair mounted sharply after the Brexit Voting. Today on Thursday, we do have low to medium impact economic events, but the focus is most likely to stay on the high impact Parliament Brexit Vote. The MPs will vote on whether to ask the European Union for permission to delay the date for departure.
So once again it’s a big day for the Sterling pairs as these are already maintaining an average daily movement of +200 pips. In this update, we are going to share a trading plan for the EUR/GBP and GBP/USD considering the Brexit Vote.
Parliament Brexit Vote
Today, the British Members of Parliament will vote on whether to ask the European Union for permission to delay the date for departure. If they vote for the extension, the Brexit could be delayed for short or a much longer one.
Actually, it depends on whether MPs backed the prime minister’s existing withdrawal deal that has been accepted with the EU by 20 March.
Thus, the British PM Theresa May could give another try to get her deal into Parliament in the next few days.
EUR/GBP – Technical Outlook & Trade Plan
The British cross EUR/GBP pair fell sharply for more than +150 pips to place a low around 0.8472. Fortunately, team FX Leaders managed to secure its share from the market.
- During the early Asian session, the pair recovered most of its losses as the EUR/GBP completes 38.2% retracement at 0.8540.
- On the 4-hour timeframe, the pair seems to cross above the 38.2% level to go after 50% level of 0.8560.
- Considering the fundamentals in view, the market is heavily depending upon the Brexit Vote. However, the technical indicators will play their role ahead of voting.
Key Trading Level: 0.8535
EUR/GBP – Trade Idea
Consider selling below 0.8560 with a stop loss above 0.8580 and take profit around 0.8490. On the flip side, the bullish breakout above 0.8560 can lead prices towards 0.8630 today.
GBP/USD – Technical Outlook & Trade Plan
During the late New York session, the GBP/USD reached a fresh daily high at 1.3378 and pulled back modestly. At the time of writing, the pair trades at 1.3245, down almost 140 pips for the day, despite all the political uncertainty. It’s because of the fact that the traders are cashing out profits ahead of Brexit Vote today.
Technically, GBP/USD is likely to gain support around resistance become support level of 1.3235. The bearish breakout can push it deeper towards 1.3145 and 1.3055. On the upper side, the pair has the potential to go after 1.3370 today.
Key Trading Level: 1.326
GBP/USD – Trade Plan
Consider staying bearish below 1.3260 with a stop loss above 1.3290 and take profit around 1.3130.
Let’s wait and watch the Brexit voting for further clues about the next trend. Good luck!