GBP/USD fills week-start gap-down towards regaining 1.3700 amid mixed clues

• GBP/USD picks up bids following the downside gap to 1.3666.
• British expats stopped from boarding flights to Spain on post-Brexit documentation issues.
• UK’s two million covid jabs a week seems less achievable amid supply concerns.
• UK Manufacturing PMI, Brexit headlines eyed for fresh impulse.

GBP/USD probes an intraday high of 1.3665 while filling the downside gap to 1.3650 during the early Asian session on Monday. In doing so, the cable traders remain cautiously optimistic following a Brexit deal passage by the UK’s Parliament as the coronavirus (COVID-19) woes probe bulls.

Despite overcoming the thorny issue of Brexit and getting it through the parliament, the Britons aren’t spared from the divorce issues. Recently, The Telegraph came out with the news suggesting British ex-pats stopped from boarding to Spain amid documentations issues. Travelers were informed that they don’t have correct residential proofs even if “The Foreign, Commonwealth and Development Office (FCDO) had previously stated that Spanish authorities had confirmed that both green residence certificates and the new documentation (TIE), along with valid passports, would be enough proof for people to travel back to Spain,”  said the news.

Also on the negative side were the headlines from Reuters, quoting The Telegraph, which mentions that the UK’s National Health Services (NHS) has not committed to delivering two million COVID-19 jabs a week. Amid the record high covid cases and death toll, slow vaccinations challenge the GBP/USD buyers. The news said, “The health service said the supply of vaccines remained the “main barrier” to delivering tens of millions of doses despite manufacturers insisting that doses were being delivered to the timetable agreed with the government.”

Furthermore, The Financial Times’ (FT) survey mentioned that the UK economic recovery will be slower than in peer countries because of a lower starting point, a larger services sector, low business investment and the impact of Brexit.

It should, however, be noted that the US dollar weakness amid broad market optimism and rallying equities favor the sterling buyers. Latest updates from the US Congress unveil Nancy Pelosi’s re-election as the US House Speaker, which in turn indicates an easy way for further stimulus. However, Georgia's electoral runoff will decide the fate of the Senate majority and will be crucial to watch.

Other than the Brexit, virus and US headlines, the UK’s second reading of Manufacturing PMI for December, expected to confirm 57.3 initial estimations, will also be important to watch.

Read: GBP/USD Price Forecast 2021: Cable braces for calendar comeback amid three exits

Technical analysis

Although the 1.3700 round-figure guards the pair’s immediate upside, GBP/USD sellers may wait for entries unless witnessing a downside break of a two-week-old support line, at 1.3617 now.