The pound is getting an indirect lift from the euro's gains today
The move to the downside yesterday stalled as the daily support from the 19 July low @ 1.2958 helped to limit declines and Boris Johnson's less conflicting demeanor helped to ease fears of Theresa May being ousted for the time being.
Since then, cable has steadily climbed and now it's aiming for a move back above 1.3000 again. The high that the pair is touching now is 1.3010.
The pair looks to be making its way through some minor resistance just above 1.3000 but the key for buyers will be aiming for a move of the 100-hour MA (red line) @ 1.3042. As long as price remains below that, near-term bias remains more bearish.
But for sellers, a hold below 1.3000 will be more convincing of a return back to test yesterday's lows. Track above 1.3000 and I'd say buyers will have more conviction to aim for a test of the 100-hour MA. Following that, there's swing region resistance around 1.3070-75 before the 200-hour MA (blue line) @ 1.3092 is eyed. As for overall bearish momentum, as long as price holds below the 100-day MA @ 1.3120 then that still remains intact.
On the other hand, for buyers it's all about holding price below 1.3000 in a bid to test the daily support at 1.2958 again.
The next key risk event to come for the pound will be the September services and composite PMI prints at 0830 GMT. That will be the next near-term driver in the absence of relevant Brexit developments for now. But once again, be wary as the biggest risk driving the pound for the next two months will be Brexit and any related headlines.
