16.11.201809:07 Forex Analysis & Reviews: Global macro overview for 16/11/2018

Prime Minister May secured the support of her cabinet for the Brexit project, but this is a small step ahead of the bigger challenge of voting in the parliament. The GBP is traded with a great deal of caution in the madness of political comments. A good result of focusing on Brexit is taking away the glow from the dollar and releasing nervousness.

After five hours of debate, Prime Minister May's government approved the Brexit project negotiated earlier with EU officials. Nevertheless, looking at the GBP you cannot see euphoria because yesterday's decision was one of the easier ones. An EU summit is planned for November 25, where the Member States will sign a divorce project with Great Britain, and then Prime Minister May will face a powerful challenge to convince most parliaments of the document. Prime Minister May made it clear: the choice is between the solution and the lack of any contract with the risk of Brexit cancellation. This may undermine the power of the brexitists' opposition and criticism, but it certainly will not close their mouth completely. We have a carousel of comments from the British political scene and probably a few resignations from the government. Already announced the departure of the British negotiator Raab is a big blow to May and will receive her votes in the parliament. Speculation about the potential motion of censure is also not silent. The application requires only 48 Tory signatures, but 159 votes in the parliament and the latter number may be difficult to get with the ultimatum that May set.

Let's now take a look at the GBP/USD technical picture at the H4 time frame. The GBP can wait for a roller coaster with initial weakness (reduction of position after yesterday's mini-success May), but more visionary and aggressive investors will look for opportunities to get on the rally and try to go long during the pull-back to the level of technical support at 1.2723. Nevertheless, to regain the control, the demand side of the market must break through the level of 1.2800 - 1.2852 on its way to 1.3047 - 1.3071 zone. Otherwise, the bears will try to push the prices towards the technical support again and break below it, aiming the level of 1.2659.