- GBP / USD expects deeper losses as Omicron restrictions derail the BoE’s rate hike bets.
- US dollar jumps with mixed market mood, critical daily support line remains at risk.
- The DMA of 21 is the level to beat for GBP bulls if the bounce from the yearly lows kicks in.
The GBP/USD is losing around 0.27% on the day at 1.3190 after having lost 45 pips from the intraday high at the end of the Asian session at 1.3216 to the daily low 1.3171 in the last hour
The guidance of Plan B announced by British Prime Minister Boris Johnson on Wednesday has delayed the expected rate hike from the Bank of England (BOE) to February 2022, undermining sentiment around the local currency.
Meanwhile, uncertainty about the new variant of COVID and its implications for global economic growth is keeping investors on the edge, raising the safe-haven attractiveness of the US dollar, which in turn weighs on the pound.
Looking at the GBP / USD daily chart, the price is still heading towards the critical falling support line at 1.3111.
In the resurgence of the sale, this last zone could give way, opening floors for a strong sale towards the 1.3000 figure.
The 14-day Relative Strength Index (RSI) is set just above the oversold territory, allowing room for a further decline.
GBP / USD: Daily chart
Alternatively, if the bulls manage to defend the yearly lows of 1.3167, then a bounce towards the bearish 21-day DMA at 1.3341 cannot be ruled out.
Before that, the buyers will test the bearish commitments at 1.3300.
Technical Levels
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