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  • GBP/USD prints three-day losing streak, fails to keep corrective recovery from 13-day low.
  • UK PM Johnson, EU President von der Leyen couldn’t overcome the key hurdles, Tory leader will go to Brussels during the week.
  • If negotiations fail, no fresh rounds are on the table during 2021.
  • Investment banks are cautiously optimistic, trade punters worried.

GBP/USD remains pressured around the intraday low of 1.3343, down 0.22% on a day, while heading into Tuesday’s London open. Although the US dollar fails to extend the previous two days’ recovery moves, Brexit woes weigh on the Sterling. Moving on, a light calendar will keep the pair traders directed towards Brexit headlines for fresh impetus.

Not only Brexit negotiators from the UK and the European Union (EU) but their leaders, namely British PM Boris Johnson and EU President Ursula von der Leyen also failed to solve the multi-month-old riddle. While both the leaders allege each other for the failure to offer a soft Brexit, none of them wants to leave the table.

Fisheries, a level playing field and governance are the key hurdle while a stoppage to the Internal Market Bill (IMB) seems to have eased pressure from the bloc. Even so, British policymakers’ readiness to accept the harsh departure from the ex-neighbor adds to the market worries.

Having announced an absence of conditions to finalize the agreement, UK PM Johnson will head to Brussels for further discussions during the week to have the deal ready. Though, many hurdles doubt a success. Even so, Reuters mark multiple investment banks comprising Rabobank, Standard Chartered and Berenberg to convey fewer chances of a no-deal Brexit.

On the other hand, chatters concerning the US stimulus improve as Senate Majority Leader Mitch McConnell and House Speaker Nancy Pelosi both sound optimistic in their latest comments over the aid package related discussions. Though, the US-China tension and recently highest covid numbers from the US, Tokyo and Hong Kong seem to have weighed down the risk-tone.

While portraying the same, stock futures from the UK and the US remain mildly offered while the US 10-year Treasury yields remain sluggish around 0.93% by press time.

Looking forward, a lack of major data/events on the calendar will keep GBP/USD traders directed towards Brexit headlines. Though, surprise announcements relating to the US stimulus and Sino-American tussle should also be observed closely.

Technical analysis

Failures to keep the corrective bounce join bearish MACD to keep the GBP/USD sellers hopeful. Hence, the current selling pressure eyes re-test of the 200-bar EMA, near 1.3230 now. Though, any further downside will not hesitate to challenge November 12 low close to the 1.3100 round-figure. Alternatively, the 1.3400 threshold and 1.3430 can offer immediate upside barriers to the pair’s fresh recovery moves.