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EU and UK representatives are set to announce an agreement in principle this Thursday, which keeps the pound on the winning side. GBP/USD, which is technically bullish, peaked at 1.3604 today and points to the 1.3624 year high, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

“A post-Brexit deal is closer, although an official announcement has not been made yet. Same old, same old, although market participants believe this time is the good one. Just the fact that they are still working on it despite being Christmas Eve, is a clear sign that both the EU and the UK are willing to do whatever it takes to prevent a no-deal exit. A press conference is in the docket, although the timing is uncertain, as last-minute discussions continue.”

“A deal is mostly priced-in at this point, but the pair could run past the year high of 1.3624 on a confirmation, mainly considering thin holiday volumes may exacerbate movements.” 

“A no-deal scenario is not considered at the time being and could be a shocker for bulls, triggering a sharp sell-off.”