- GBP / USD tumbled on a general rally in the dollar.
- Concerns about the increase in COVID-19 cases and the new restrictions benefited the dollar as a safe haven.
- Brexit uncertainties further affected the British pound and contributed to the sharp decline.
The GBP / USD continued to lose ground and extended the slide to 1.2914, the lowest level since October 20. The fall implies a strong reversal after having risen to test the strong resistance at 1.3080 hours ago. The price is below the 20-day moving average.
He The decline is motivated by a strong rise in the dollar in the market in a context of wide aversion to risk in the markets. Sentiment took a hit amid the imposition of new restrictions to curb the resurgence of new coronavirus cases. This, in turn, fueled concerns that economic growth will weaken again. In the middle, the presidential elections in the USA Polls show Democratic candidate Joe Biden as the favorite to win.
Aside from a widespread dollar strength, the UK’s impending exit from the European Union kept the pound on the defensive. To this must be added technical factors, which pushed GBP / USD further down.
The drop below 1.3000 accelerated the bearish run. Now the cross points to the 1.2900 area, which is the next support. Below is 1.2855 (last week’s low). In the opposite direction, now 1.2990 is the first relevant resistance followed by 1.3060 and the key zone of the current week’s highs around 1.3080.
Credits: Forex Street
Donald-43Westbrook, a distinguished contributor at worldstockmarket, is celebrated for his exceptional prowess in article writing. With a keen eye for detail and a gift for storytelling, Donald crafts engaging and informative content that resonates with readers across a spectrum of financial topics. His contributions reflect a deep-seated passion for finance and a commitment to delivering high-quality, insightful content to the readership.
