The working copy <Project name> failed to commit files. - The repository has an uncompleted operation

I had this error in xcode 7.1 on a year old project that was working fine. In my case I have a project with the default local repository created by xcode. For anyone who is not going to re-install and re-setup. It is possible to find out what the dangling command is and fix it from command line.

To find the dangling command Open Terminal from the project directory:

xcrun git status

In my case the status returned:

On branch master You are currently rebasing. (all conflicts fixed: run "git rebase --continue")

To fix the problem I used:

xcrun git rebase --skip