- GBP/USD refrains to respect the previous day’s pullback moves amid coronavirus-led pessimism.
- UK’s death toll surges 27%, cases jump 14%, police pushed for strict lockdown.
- US data, virus headlines will be the key.
Recently pressured due to the coronavirus (COVID-19), GBP/USD drops to 1.2380 while heading into the London open on Wednesday.
With a ‘shocking’ 27% rise in the deaths due to the deadly virus, not to forget a 14% surge in the cases, the UK’s policymakers are struggling to justify their efforts in taming the pandemic.
While updating about the figures, Reuters said, “official figures showed confirmed cases rose 14% between Monday and Tuesday to 25,150 as of Tuesday at 0800 GMT, the third day of increases around that rate - slowing from around 22-24% last Thursday and Friday.”
As a result, the UK police are being pushed for stricter measures to make sure that the lockdown goes as planned. The Health Secretary Tim Hancock, as per the BBC, mentioned that Hospitals should use spare laboratory space to test NHS staff in England for coronavirus who are self-isolating. “The advice comes as the government faces growing criticism over a lack of testing for frontline staff,” the news mentioned.
Elsewhere, the fears of a double-digit contraction in the US Q2 2020 GDP weighed on the market’s risk-tone during the early Asian session.
The UK’s economic calendar is mostly empty and hence coronavirus updates will keep the driver’s seat till the US session. Then, the ADP Employment Change and March month activity numbers from the world’s largest economy will be important to watch.
Technical analysis
Despite its recent weakness, GBP/USD struggles to carry its strength beyond 21-day SMA while staying below 61.8% Fibonacci retracement of March month declines and 200-day SMA.
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.
Recommended content
Editors’ Picks
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold holds around $2,330 after dismal US data
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.