GBP/USD: Recent recovery to be short-lived
|GBP/USD has stabilized amid reports of progress in Brexit talks but the surge in coronavirus cases and uncertainty about the US elections are set to push it lower. Furthermore, Thursday's 4-hour chart is pointing to the downside, as FXStreet’s Analyst Yohay Elam notes.
More:
-
GBP/USD: Lockdown fears to overshadow positive Brexit news – MUFG
-
GBP/USD: The likelihood of a Brexit agreement is increasing, pound to rally 8-10% – Westpac
Key quotes
“Britain and the bloc are still at odds over the politically sensitive topic of fisheries. The minuscule sector in both the UK and France is pressing on politicians to take a tough stance and talks may still result in acrimony.”
“The northern hemisphere is gripping with a harsh second wave of COVID-19. Both France and Germany announced new national lockdowns on Wednesday, and it seems like a matter of time until others follow. Prime Minister Boris Johnson is under growing pressure to abandon his regional approach and announce nationwide restrictions. UK covid statistics are breaking records almost on a daily basis. The upcoming publication, due in the afternoon, is set to move the pound.”
“Tension is mounting ahead of the elections. Despite models pointing to near 90% of a victory for Democrat Joe Biden – and the fact that over 75 million Americans have already cast their ballots – the memory of 2016 is looming. Moreover, the incumbent refused to commit to accepting the results, raising the chances of a contested election. Additional opinion polls are awaited on Thursday and could cause the safe-haven dollar to further appreciate in response to fears.”
“The round 1.30 level remains a battleground. It is followed by Wednesday's swing low of 1.2920, followed by 1.2860. Resistance is at the daily high of 1.3020, followed by 1.3060 and 1.3080, recent swing highs.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.