The best performer Monday was the British pound that rallied as signs the U.K. and European Union are close to agreeing a trade deal. The latest progress in the development of a coronavirus vaccine bolstered the currency’s upward move.
Bulls in the GBP/USD profited while sterling rose to the highest level since early September. Looking ahead, the potential for progress in Brexit talks, growing optimism for a vaccine and fresh fiscal stimulus should keep the cable supported.
We bear in mind, that a Brexit deal is largely priced in to the pound, which is why a breakdown in talks would see a much larger move lower.
The euro experienced a sharp reversal after the U.S. dollar gained traction on better than expected flash PMI data. The monthly PMI report crushed market forecast as it came in at a five-year high.
From a technical perspective, not much has changed in the EUR/USD. Above 1.1920 gains may be extended towards 1.1960 whereas below 1.1790 the euro may slip towards 1.1690.
The U.S. dollar could experience bullish tailwinds in short-term time frames as robust U.S. economic data could downplay the urgency of another fiscal stimulus package or additional accommodation from the Federal Reserve.
We wish you good trades!
Any and all liability of the author is excluded.
Copyright © All Rights Reserved 2020 MaiMarFX.
Follow us on social media: