GBP/USD: Bulls eye 1.3750 amid easing EU-UK vaccine row, stimulus hopes


  • GBP/USD eases from intraday high as bulls catch a breather after a 130-pip rise in the last four hours.
  • UK is out of the list of countries to witness tighter covid vaccine export restrictions produced in the EU.
  • 600,000 jabs a day, receding virus numbers and US President Joe Biden’s call to Republicans for stimulus battle market frenzy.
  • UK Final Manufacturing PMI, US ISM Manufacturing PMI will decorate the calendar, risk catalysts remain as the key.

Despite recently stepping back from the day’s high of 1.3739 to 1.3731, GBP/USD stays on the bull’s radar with 0.24% intraday gains while heading into Monday’s London open. The Cable eyes further gain as the European Union (EU) refrains from putting the UK on the export restriction list while chatters over further easing from the UK and the US also help improve the mood ahead of the key PMI data.

EU President Ursula von der Leyen’s comments suggesting additional 900,000 covid vaccines for the bloc seems to be the cause of Brussels’ readiness to keep the UK free of its list containing multiple countries where the export of jabs will have additional filters. The Guardian puts it as, “The UK has been left off a list of more than 120 countries exempted from tighter export restrictions on vaccines produced in the EU, in the latest twist in the bloc’s row with AstraZeneca over a shortage of doses.”

Also on the positive side could be the UK’s 600,000 vaccinations a day and recently easing virus numbers from Britain. It should be noted that optimism surrounding British Trade Secretary Liz Truss’s ability to gain the best trade deal from the US and chatters over American stimulus also favored the risks. Additionally, the Financial Times’ stated UK PM Boris Johnson and Chancellor Rishi Sunak prepare for anticipated recovery with a “pre-Budget recovery plan”, which helped brighten the risks. Furthermore, US President Joe Biden’s call to discuss the much-awaited aid package with 10 Republicans eyeing a $600 billion budget, versus $1.9 trillion, add optimism to the mood.

On the contrary, talks on the social media platform for silver’s rally and likely further limitations on market joined Irish Taoiseach’s push to placate the EU-UK vaccine row while challenging the risks. Furthermore, anti-lockdown protests in Brussels, Budapest and Vienna offer extra burden to the market sentiment but gain little attention.

Against this backdrop, stock futures reverse early-day losses while stocks in Asia-Pacific trade mostly positive. Further, the US 10-year Treasury yields also recover to 1.08% by press time.

Looking forward, UK’s final Manufacturing PMI for January, expected to reprint 52.9 figures, will precede the US ISM Manufacturing PMI for the previous month, likely to recede from 60.7 to 59.5, to entertain the GBP/USD traders. It should, however, be noted that the risk catalysts remain as the key.

Technical analysis

An ascending trend line from December 21, currently around 1.3680, holds the door for short-term GBP/USD sellers’ entry. Beyond that, the pair buyers keep targeting the 1.3800 threshold, with 1.3750 acting as an immediate hurdle.

Additional important levels

Overview
Today last price 1.3732
Today Daily Change 34 pips
Today Daily Change % 0.25%
Today daily open 1.3698
 
Trends
Daily SMA20 1.3642
Daily SMA50 1.3517
Daily SMA100 1.3258
Daily SMA200 1.2976
 
Levels
Previous Daily High 1.3751
Previous Daily Low 1.3657
Previous Weekly High 1.3759
Previous Weekly Low 1.361
Previous Monthly High 1.3759
Previous Monthly Low 1.3451
Daily Fibonacci 38.2% 1.3693
Daily Fibonacci 61.8% 1.3715
Daily Pivot Point S1 1.3653
Daily Pivot Point S2 1.3608
Daily Pivot Point S3 1.3559
Daily Pivot Point R1 1.3747
Daily Pivot Point R2 1.3796
Daily Pivot Point R3 1.3842

 

 

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news

How do emotions affect trade?
Follow up our daily analysts guidance

Subscribe Today!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD jumps to three-week highs near 1.1650 amid falling dollar, yields

EUR/USD is trading close to 1.1650, recovering ground to clinch three-week highs. The pair cheers risk-on mood-led decline in the US dollar. Treasury yields pullback, as poor US industrial data tempers hawkish Fed’s expectations. Focus on ECB and Fedspeak.

EUR/USD News

GBP/USD advances towards 1.3800 amid risk-on mood, hawkish BOE

GBP/USD is advancing towards 1.3800, reaching the highest levels in five weeks. The greenback is losing ground amid a resurgent appetite for riskier assets. BOE's Bailey hinted at a rate hike to contain inflation. UK PM Johnson vowed to fix Brexit’s N. Ireland Protocol. 

GBP/USD News

Gold rebounds towards key $1795 barrier but downside risks remain intact

Gold price extended Friday’s sell-off on Monday to test the $1760 level but managed to recover some ground to settle the day around $1765. Lack of first-tier data to leave gold at the mercy of the dynamics in yield, USD.

Gold News

Litecoin on the cusp of 26% breakout

Litecoin price is on the penultimate leg of a technical formation that will catalyze a quick bull rally. LTC needs to clear one critical hurdle to kick-start a run-up to levels last seen more than a month ago. Litecoin price has been on a slow but steady uptrend since Oct 13.

Read more

Netflix Stock Price and Forecast: When are NFLX earnings?

Netflix stock falls nearly 1% on Friday ahead of earnings. NFLX releases earnings on Tuesday, October 19, after the close. Netflix stock has been boosted by the success of Squid Game.

Read more

Forex MAJORS

Cryptocurrencies

Signatures