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  • GBP/USD gained strong follow-through traction for the second straight session on Wednesday.
  • The upbeat mood undermined the safe-haven USD and remained supportive of the momentum.
  • Approval of COVID-19 vaccine by AstraZeneca/Oxford further boosted the global risk sentiment.

The USD selling remained unabated through the first half of the European session and pushed the GBP/USD pair to fresh weekly tops, around the 1.3575-80 region in the last hour.

The pair added to the previous day’s goodish positive move and continued scaling higher for the second consecutive session on Wednesday. The momentum was exclusively sponsored by the heavily offered tone surrounding the US dollar and assisted the GBP/USD to reverse Monday’s corrective slide.

Despite a Senate delay in US stimulus checks, investors remained optimistic about the likelihood of additional financial aid. This, along with increasing bets for a strong global economic recovery in 2021, remained supportive of the upbeat market mood and undermined the safe-haven greenback.

Investors’ appetite for perceived riskier assets got an additional boost after UK regulators approved the use of the AstraZeneca/Oxford coronavirus vaccine. This was seen as another factor that drove some flows towards the British pound and remained supportive of the GBP/USD pair strong move up.

That said, concerns about the exclusion of the crucial services sector in Brexit agreement and a sharp rise in new cases infected by a mutant coronavirus in the UK might cap gains for the GBP/USD pair. Moreover, year-end thin liquidity might further hold bullish trades from placing fresh bets.

There isn’t any major market-moving economic data due for release from the UK. The US economic docket features the second-tier releases of Goods Trade Balance, Chicago PMI and Pending Home Sales. This leaves the GBP/USD pair at the mercy of the USD price dynamics and the market risk sentiment.

Technical levels to watch