- GBP / USD consolidates at two-month highs around 1.3250.
- News of the coronavirus vaccine and the Brexit deal hope to boost demand for the British pound.
- Technically, the pair should remain above 1.3200 to maintain its bullish momentum – UOB.
The pound it is climbing on Tuesday, extending its bull run from last week’s lows at 1.2850 to fresh two-month highs in the midrange of 1.3200. Optimistic news of a COVID-19 vaccine and hopes for an imminent Brexit deal have increased demand for the British pound.
Libra rises on COVID-19 vaccine news and Brexit news
The British pound is appreciating across the board on Tuesday, rising 0.5% against the US dollar, fueled by hopes that a COVID-19 vaccine will help prop up the UK economy. The impact of the promising results of a possible cure for the coronavirus has been particularly positive for the British pound, as it could make a big difference for the United Kingdom, which is one of the European countries most affected by the coronavirus.
Furthermore, market rumors about the progress of Brexit negotiations with the EU have further increased confidence in the GBP. UK officials have suggested the parties may have moved closer together, fueling hopes for a trade deal before the December 31 deadline.
GBP / USD should stay above 1.3200 to retain bullish momentum – UOB
From a technical perspective, the UOB currency analysis team believes that the bullish momentum has improved, but warns that the pair should stay above 1.3200 to defend against the bears: “While the bullish momentum has improved, the GBP it has to move and stay above the main resistance at 1.3200 before a further sustained advance can be expected. ‘ The GBP rose above 1.3200 yesterday (Nov 09) but eased after hitting 1.3207 to end the day little changed at 1.3162 (+ 0.09%). Another attempt to move clearly above 1.3200 is not ruled out yet and only a break of 1.3065 (unchanged from the ‘strong support’ level) would indicate that the current bullish pressure has eased. ”
Credits: Forex Street
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