GBP/USD testing the 1.3050 psychological level post double top

GBP/USD is testing a critical support structure as it ploughs through stops having lost grip of the 13080 pivot and wilts beneath a bearish double top.

Fundamentally, the US dollar is firmer on intrinsic values as the spread of the coronavirus in Germany and the rest of the world trumps the narrative that is a problem unique to the US.

New York witnessed a spike in US yields and a subsequent rally in the greenback, coming back off its lowest levels in more than two years since late July in the DXY.

We are seeing jittery summer markets along with the trade war fears have all contributed to a firmer greenback.

Meanwhile, the Bank of England will be on the minds of traders following the latest Monetary Policy Committee statements which prove that the Bank of England is still actively reviewing negative interest rates.

The UK economy faces a trifecta of risks, stemming from possibly renewed Covid-19 related restrictions, an economically difficult Brexit, and significant labour market weakness.,

analysts at Rabobank expalined.

We find it hard to see how this isn’t ultimately met with a monetary policy response. We stick to our call for another GBP 100bn increase of the APF, setting our sights at the November meeting.

Pertaining to the coronavirus damage to the economy, rising unemployment is probably the biggest threat to the recovery.

The virus is far from done and the gradual unwinding of the government’s furlough scheme over the next few months will be met with ongoing consumer caution and social distancing constraints.

On the plus side, however, the UK’s chief Brexit negotiator said on Thursday that a free trade agreement with the European Union could be agreed in September, as Ireland’s prime minister said a “landing zone” for the deal had emerged….

GBP/USD levels