GBP/USD Price Testing mid-1.37 Demand Zone, Delta Hitting Hard

• GBP/USD could not halt the fall on Monday that started off on Friday.
• Central banks’ actions are not responsible for the fall but the spread of the Delta strain.
• If PM Boris lifts COVID restrictions, we can see a rally in the Pound.

The GBP/USD price moved quite actively on July 16, unlike the EUR/USD pair. The reasons for the resumption of the collapse on Monday should, in our opinion, be sought in Britain. Long research is usually not necessary as no macroeconomic statistics were published on Friday.

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The key question to the possible conclusion of the Bank of England’s stimulus package is at the same stage as the US Federal Reserve. Therefore, we see the difficult situation of the coronavirus in Foggy Albion as the main reason for the resumption of the decline in the Pound.

Yes, although the UK is among the best in the world for vaccination rates and around 70% of adults have already received both doses of the vaccine, the UK is currently setting a new record of cases. Remember that the largest increase in daily inquiries in the third (strongest) wave was 68,000, with 54,000 new infections registered on Saturday. Interestingly, all quarantine restrictions in the country will be lifted today, as Boris Johnson previously announced.

It will be very interesting to know whether the UK Prime Minister keeps his promise or postpones this unreasonable decision on the advice of doctors and epidemiologists.

GBP/USD price technical analysis: Will demand zone hold?

From a technical point of view, note that the pair usually fluctuates. This can be seen with the naked eye in the picture below.

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The chart above also shows that the price has been around its strong demand zone. If the demand zone holds, we can see a jump of more than 50 pips during the London session. The Friday decline came up with a decreasing volume. It means that no additional buying occurred. Rather, the price was carried by profit-taking.  However, the recent volume is quite low below the average line. GBP/USD

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