GBP/USD looks to 1.3400 on vaccine hopes, eyes weekend Brexit talks

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  • GBP/USD keeps late-Thursday’s recovery moves, nears intraday high.
  • British government pushes MHRA for temporary supply of AstraZeneca vaccine approval.
  • EU-UK policymakers to hold a brief Brexit meeting during the weekend, no progress expected.

GBP/USD stays mildly bid, currently up 0.10% to 1.3370, while heading into Friday’s London open. Disappointment over AstraZeneca’s extra trials and Brexit woes dragged the quote back from three months high the previous day. Though, fresh optimism concerning vaccine and the coronavirus (COVID-19) favor sterling ahead of this weekend’s trade negotiations between the UK and the European Union (EU).

Following its inability to go ahead for approval of the covid vaccine, mainly due to the issues that led to an extra trial for small-dosage cures, the British government helped AstraZeneca by pushing the Medicines and Healthcare Products Regulatory Agency (MHRA) for a temporary supply of vaccines. The vaccine expectations join the first decline in the rate of covid-led hospitalizations, as conveyed by The Guardian, to renew the GBP/USD buying.

On the other hand, the BBC reporter Nick Beake mentioned, in a tweet, about this weekend’s face-to-face Brexit talks. The media person also mentioned that the talks could be brief. Earlier in Asia, a representative from the Daily Express conveyed views favoring no progress in fisheries talks, the key hurdle for the Brexit trade deal.

It should also be noted that US President Donald Trump announced the vaccine delivery to start from the next week but the risk-tone remains sluggish as the China-Aussie row intensifies while the Sino-American tension continues. That said, stock futures stay mildly offered in the US and the UK while Asian shares trade mixed by press time.

Considering a lack of major data/events, GBP/USD traders will keep their eyes on the Brexit, vaccine headlines for fresh impulse. While no major positives are expected from the talks, UK PM Boris Johnson’s spokesperson conveyed the Tory leaders’ readiness to bridge the gap, which in turn backs hopes of a surprise and the cable’s run-up beyond 1.3400.

Technical analysis

An upward sloping trend line from November 02, at 1.3345 now, directs the GBP/USD bulls to challenge the 1.3400 once again.

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