GBPUSD eyes 1.2000 key level as article 50 is ready to be invoked

GBPUSD had a fantastic day on the first trading day of the week as it enjoyed its strongest one-day rally against the U.S dollar. This was its first major rally in more than 2 weeks. What next as GBPUSD eyes 1.2000 key level.

14 March, AtoZForex -From the news making waves presently, especially from Independent newspaper and a spokesman for U.K. Prime Minister Theresa May, Article 50 may not be triggered this week. In yesterday’s vote, the House of Lords overwhelmingly opted to overturn the amendments to the Brexit bill.  This sends the bill back to the House of Lords who are unlikely to reject the will of the people.  Once both Houses of Parliament agree on the language in the bill, it would be sent for Royal Assent and become law, whereby allowing May to trigger Article 50.  So how quickly Article 50 is triggered will be partly determined by how quickly the House of Lords accepts the House of Commons’ decision.

However, if Prime Minister May suddenly announces the trigger this week, traders can expect a knee-jerk breakdown in GBP that should not last for long as investors realize that it will be months before the terms of exit are agreed to with the E.U. and years before an official exit happens.

GBPUSD eyes 1.2000 key level; Daily Technical Analysis

GBPUSD eyes 1.2000 key level GBPUSD D (Click to zoom)

GBPUSD is currently under pressure due to the political risks in the region as stated in our weekend piece. Technically, the levels laid out in our weekend piece GBPUSD Weekly trade ideas ahead of Article 50 trigger are still well into play. With super Wednesday approaching, it’s just a matter of time before the cable prints the bottom of the daily range. However, we still see the weakness in the cable as an opportunity to buy cheap especially around the 1.2000 levels. A breach of this level will definitely be so so bad for the cable. Going forward, a daily close below the 1.2130s will have price aim for the 1.2070 to the 1.2000 region. We shall keep you abreast of the happenings and trade opportunities as the week progresses.

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