The British pound rose to a high of 1.3273 Tuesday as the U.K. and European Union edge closer to agreement on longstanding sticking points. A possible breakthrough could be announced as soon as Monday while there is still potential for the negotiations to collapse.
GBP/USD: The cable will now need to overcome the 1.33-1.3310 hurdle and if that bullish breakout happens, we will turn our focus to a higher target at 1.3480. On the downside, the 1.32-level will now play an important role and if the pound falls below 1.3190 we may see a dip toward 1.31.
No Big Market Moves
With the election uncertainty behind us, the market’s focus turned to Covid and the vaccines but we remember that wide distribution of a shot is still months away, which is why big market movements are currently missing. We may get some news on the stimulus front in the next weeks that could breathe new life into the market. We will wait and see.
EUR/USD: We still see a current resistance at 1.1940-50. If the euro, however, falls back below 1.1840 in short-term time frames it may extend losses toward 1.18 and 1.1750.
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