GBPUSD: Sterling Soars as Brexit Ministers Resign

09 / 07 / 2018
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The pound was trading 0.6% stronger on Monday and the GBPUSD pair was trading around 1.3350 during the London session, hovering at one-month highs.

Over the weekend, Theresa May won approval at an all-day Chequers summit for a pro-business plan to keep Britain intimately bound to the EU single market and customs union, beating back Eurosceptic cabinet opposition to her new “soft Brexit” strategy.

Shortly after, David Davis, the former Brexit Secretary and Minister resigned. He was a Hard Brexit supporter and seeing the UK heading for a soft Brexit probably made him quit. Another three people from his cabined resigned as well.

Traders digested these news and pushed the pound sharply higher as it appears the Hard Brexit supporters no longer prevail.

The GBPUSD pair broke the bearish trend and therefore further upside momentum could occur. The next resistance is now seen at previous highs of 1.3452/60, while the support remains around Friday’s close near 1.3280. The momentum seems bullish and this is also confirmed by the big MACD divergence on the daily chart.

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