The cable is standing out by advancing above 1.39. A quick look at the GBP/USD chart is pointing to a positive pattern for the pound – and Britain’s success in curbing coronavirus is the major fundamental reason to think bulls will prevail, according to FXStreet’s Analyst Yohay Elam.
See – GBP/USD: A test of the 1.4000 level looks inevitable – MUFG
Key quotes
“US President Joe Biden returns to work after a long weekend and his $1.9 trillion covid relief package is left, right, and center. The upcoming fiscal boost from America is music to markets’ collective ears and previously pushed the safe-haven dollar lower. On the other hand, the prospects of faster growth and higher debt issuance have now resulted in a sell-off of US bonds, pushing yields higher and thus making the greenback more attractive.”
“The UK recorded the lowest number of COVID-19 infections since October, the result of the nationwide lockdown and the vaccination campaign. The immunization effort continues at full speed, with Britain already jabbing nearly 24 doses per 100 persons.”
“Prime Minister Boris Johnson is planning a major speech on Monday, to lay out his plans to ease the lockdown. Details are set to begin leaking and any rapid reopening may boost the pound.”
“Pound/dollar continues benefitting from upside momentum on the 4-hour chart while the Relative Strength Index is just below 70 – outside overbought conditions. Moreover, the cable is trading above the 50, 100 and 200 Simple Moving Averages.”
“Resistance awaits at 1.3950, the new 2021 top and the highest since April 2018. Further above, 1.40, 1.4110 and 1.4240 are the next levels to watch. GBP/USD has some support at around 1.39, followed by 1.3865, the previous peak. Further down, 1.3830 and 1.3870 are the next cushions.”
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