GBP/USD: Investors to shift to a sell-on-rallies stance as Brexit tensions mount - TDS

"Despite last-minute scrambles to bring MPs over to supporting her deal, May's Withdrawal Agreement failed yet again in the House of Commons, losing 344 to 286. Key to this loss was that the DUP, hard ERG brexiters, and Labour rebels did not support her deal," note TD Securities analysts.

Key quotes

"12 April is the new 29 March. But given the lack of progress, an election is looking increasingly likely in our view, and indeed May hinted at this during her address after the result was announced. Both Labour and SNP would support this."

"FX: GBP remains on its back foot in the aftermath of today's votes and we expect this to extend - particularly if cable closes the week significantly below 1.30. We think GBP has traded with the benefit of the market's doubt for long enough and look for investors to shift to a sell-on-rallies stance as Brexit tensions continue to mount."