The pound is tied for the weakest performing major currency today

Weekend Brexit rhetoric from Barnier continues to weigh on the pound as we open the new week and the currency is among the laggards on the day so far (alongside the kiwi). Cable opened with a move lower even in the wake of thin liquidity with the pair heading below 1.2900 briefly.

The downside move tested a break of the 200-hour MA (blue line) but buyers managed to claw their way back to sustain a candle close above it. For now, price is hovering just above there which means that buyers are still "in the game".

Bids around 1.2900 should help to also provide some support as well in the session ahead.

For the moment, buyers appear to be struggling to get price above the 1.3000 handle and to find a break higher. There needs to be some sort of positive Brexit headline for that to happen in my view - and the likelihood of that happening is rather slim.

That should give conviction for sellers to build their case for a move lower bu there are some support levels to navigate through.

On the 4-hourly chart, price did move below the 200-bar MA (blue line) but the trendline support is what also helped to stall declines so far today when the pair hit the lows. Currently, that support level sits at around 1.2905. That will be a key near-term level to watch in the session ahead as well.

As for risk events, expect Brexit headlines to dominate proceedings in September but for today we'll also have the UK manufacturing PMI release for August. The data isn't expected to be a major market mover but a sizable skew from expectations may prompt a minor reaction in the market nonetheless.

Apart from that, North American trading will be mired with thin liquidity as US and Canadian banks are on holiday so don't look too much into any moves then as they may cloud up the picture. Either that or it's going to be a slow and subdued start to the week.

Support

- 1.2911 (200-hour MA)

- 1.2905 (near-term trendline support)

- 1.2900 (bids, swing region)

- 1.2873 (38.2 retracement level)

- 1.2850 (swing region)

- 1.2834 (100-bar MA on H4)

- 1.2800 (bids, swing region)

Resistance

- 1.2943 (200-bar MA on H4)

- 1.2957 (100-hour MA)

- 1.2974 (7 August high)

- 1.3000 (offers, swing region)

- 1.3043 (3 August high, swing region)

- 1.3083 (76.4 retracement level)