Market News & Analysis


Top Story

Brexit Bill is Passed, however Timetable is Rejected

UK Parliament passed the Withdrawal Agreement Bill.  However, they also refused to be handcuffed into Boris Johnson’s timetable of just 2 days to read and debate the matter.  The UK’s main opposition party leader, Corbyn, said afterwards that Johnson needs to agree to a reasonable timetable.  PM Johnson must now determine whether to accelerate plans to leave the EU with no deal or ask for an extension past the October 31st deadline.  One option Johnson is considering is that the UK accept a 10-day extension, as long as it is the final extension from the EU.

Upon passage of the WAB, GBP/USD bid up roughly 75 pips in hopes that the timetable would be passed.  However, as soon as the timetable was rejected, the pair fell from roughly 1.3000 to 1.2832 on concerns that Brexit deal will be delayed further, or even worse, will end with no deal at all. 

Source: Tradingview, City Index

On a daily timeframe, GBP/USD is currently consolidating just below the psychological level and horizontal level of 1.3000.  Although has made attempts to close above 1.3000 over the last 4 days, it has yet to do so.  The bottom of the consolidation zone is roughly between 1.2880, which is the 38.2% retracement level from the April 2018 highs to the September 3rd lows, and 1.2840, which is the 61.8% Fibonacci retracement level from the May 6th highs to the September 3rd lows.  A break above or below these levels could quickly push the markets 200 pips in either direction.

Source: Tradingview, City Index

On a daily timeframe, it appears EUR/GBP still has room to go on the downside towards .8500 to complete the flag formation.  However, the RSI is oversold, and with the news today it’s no surprise the pair bounced to give time to the RSI to unwind back into neutral territory before it resumes it descent lower.  Horizontal resistance comes in near .8700.

Source: Tradingview, City Index

As we get closer and closer to the October 31st “drop dead” date for a Brexit deal, the situation is going to become more and more fluid.  Expect even more volatility as time passes!


From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.