- Pound under pressure across the board adds to the losses.
- GBP / USD corrects lower after rising for three consecutive trading days.
The pair GBP/USD it fell further during the US session amid a stronger US dollar and while the pound remains under pressure. The pair bottomed at 1.3559, hitting the lowest since last Wednesday.
Earlier on Monday, the cable reached levels above 1.3700 for the first time since April 2018 before reversing its intraday trend. The sharp drop from above was triggered by a fall in the pound amid expectations of further restrictions in the UK. The government will issue a statement on the matter. The increase in COVID-19 cases and the new strain offset the developments related to the Oxford / AstraZeneca vaccine.
At the same time, the US dollar regained strength and stock prices on Wall Street turned lower. At time of writing, the Dow Jones is down 1.60% and the Nasdaq down 1.25%. The reversal boosted the dollar which cut losses across the board.
From a technical perspective, the trend in GBP / USD still points to the upside, but the momentum waned. A consolidation below 1.3600 would favor an extension of the correction. Support levels are seen at 1.3550 / 55, followed by 1.3505 and 1.3425 / 30 (last week’s low).
Technical levels
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