GBP/USD Price Tumbles to 1.3250 Despite Better Risk Sentiment

• During the European session, the GBP/USD pair bounces around 1.3300.
• While yields remain stable, the US dollar falls amid bullish market sentiment.
• As Brexit progresses in the UK, the number of cases related to Omicron is on the rise.

As rising UK infections overshadow broader market optimism, the GBP/USD price fell to 1.3250 during the European session.

With 336 confirmed cases of the heavily mutated variant in the UK today, 90 more than on Sunday, the pound has suffered due to the unstoppable surge in new infections. “The Omicron variant of the Coronavirus is spreading in several regions of England,” according to UK Health Secretary Sajid Javid.

Despite China’s stimulus measures and concerns over a new strain of Covid worldwide, cable traders have not been able to capitalize on the prevailing risk sentiment. However, a promising signal released this week highlighted Sotrovimab’s importance in treating COVID-19 early.

In addition, the markets have ignored recent positive developments on the Brexit front and encouraging comments from GlaxoSmithKline.

According to The Telegraph, the UK is expected to offer France an olive branch to resolve the fisheries issue following Brexit. The British said that an agreement could be reached about “replacement boats,” which would allow more permits to be granted to EU ships.

UK Omicron statistics will be scrutinized on a dry calendar in the coming months. Dynamic changes in the dollar and the rate of return can also affect the main ones.

GBP/USD price technical analysis: Lacking bullish conviction

The GBP/USD price struggled to sustain above the 20-period SMA and fell back towards the interim support of 1.3250 level. The volume looks biased to the bearish side. Hence, we can expect to test of 1.3200 handle. On the upside, 1.3300 will remain a tough nut to crack.

The average daily range for the pair lies around 50% which shows that the market lacks trading activity. Perhaps the NY session may see some volatility.

Looking to trade forex now? Invest at eToro!

68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money.