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British Pound Remains under Pressure

British

Looking at the British pound on the above daily MT 4 price action chart, the benchmark GBP/USD currency exchange rate is still under pressure and trading around 1.3565 during the earl Asian trade session on Friday.

The British pound (GBP) has now fallen for two days in a row but remains above the downside barrier lining up at 1.3530. However, the recent recovery seen by the GBP/USD Forex market is cooling down. Traders are watching the coronavirus (Covid-19) outbreak in the United Kingdom which is weighing on the British currency.

Today Forex traders are watching not only Covid-19 headlines but the U.S. Whitehouse. There is also the release of the U.S. non-farm payroll (NFP) report for the month of December. British Prime Minister Boris Johnson is assuring that all citizens of the United Kingdom will be vaccinated for the coronavirus. However, there has been an alarming spike of new cases and a new national lockdown.

Also. there are also two new strains of Covid-19 from Britain and South Africa causing alarm. The United Kingdom has seen 1,162 recent coronavirus deaths as well as an alarming spike in hospitalizations straining the NHS. However, over 1.29 million citizens of the United Kingdom have been vaccinated to date. 

Across the Pond, the day after pro-Trump protesters stormed the United States Congress, House Speaker Nancy Pelosi and Democratic Leader Chuck Schumer are demanding that President Donald Trump be impeached and removed from office. There is also talk of using the 25th Amendment to remove him from both political parties.    

Daily British Pound Technical Analysis (GBP/USD)                                                                           

Looking at price action on the above GBP/USD price chart, the first layer of technical support lines up at a falling trend line. This downside barrier is at 1.3645. Below that barrier the short term twenty (20) day simple moving average (SMA) comes into focus. This level lines up at 1.3513.

 On the upside, a daily close above 1.3622 opens the door to challenge the next layer of technical resistance lining up at 1.3678. After that, the upside barrier in play at 1.3723 comes up.

About David Frank

David has his MA and PhD in Economics. He is a technical analyst who has been trading in the Forex world for over a decade. As an analyst and trader, David believes in the big picture by blending together technical analysis with the fundamentals behind the scenes in the Forex and Bond markets. David’s trading strategy is unique. He blends an understanding of fundamental and macroeconomics with technical analysis to offer a unique view into Forex. He applies several strategies including carry long positions, to take advantage of high yields in non-volatile markets, as well as using quicker, chart related analysis for day trading.

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