GBP/USD in highs through 1.2200

The continuation of the selling bias around the greenback is allowing GBP/USD to resume the upside and trade beyond the critical 1.2200 handle, or daily highs.

GBP/USD focus on Brexit, BoE, FOMC

The pair is advancing for the second session in a row for the first time since mid-February, extending the positive close on Friday to the area above the key barrier at 1.2200 the figure ahead of the opening bell in Europe today.

It will be a very interesting week for the Sterling as the Brexit bill will be discussed between today and Wednesday, while the Bank of England will meet on Thursday and the labour market figures are due on Wednesday.

Consensus among investors expect the MPs to reject the recent amendments to the Brexit bill by the House of Lords later today, paving the way for PM Theresa may to trigger Article 50 at some point later in the month.

On the USD-side, the correction lower remains unabated despite the solid figures from February’s Non-farm Payrolls (235K), while some skepticism among market participants on the likeliness of three rate hikes this year seems to have removed some tailwinds from the buck.

On the positioning front, GBP stays under pressure, as speculative net shorts have climbed to the highest level since early November and Open Interest remained on the rise during the week ended on March 7 according to the latest CFTC report.

GBP/USD levels to consider

As of writing the pair is up 0.35% at 1.2212 and a breakout of 1.2253 (high Mar.7) would aim for 1.2302 (high Mar.6) and finally 1.2354 (20-day sma). On the other hand, the next support lines up at 1.2138 (low Mar.8) followed by 1.2036 (low Jan.11) and then 1.1979 (2017 low Jan.16).