GBP/USD Daily Forecast – British Pound Falls Amid Worries About New COVID-19 Strain

GBP/USD Video 21.12.20.

British Pound Is Under Serious Pressure At The Beginning Of The Week

GBP/USD is currently trying to settle below 1.3350 while the U.S. dollar is gaining ground against a broad basket of currencies.

The U.S. Dollar Index managed to get above the resistance at 90.15 and is trying to settle above the next resistance level at 90.50. If this attempt is successful, the U.S. Dollar Index will head towards the next major resistance level at the 20 EMA at 91 which will be bearish for GBP/USD.

British pound found itself under serious pressure after a new COVID-19 strain was found in Britain. This strain is believed to be more infectious, and many European countries have already closed their borders for British travelers.

Meanwhile, UK and EU failed to reach consensus on the Brexit deal over the weekend but will continue talks on Monday. Fisheries and level playing field are the main obstacles on the way to the deal, and negotiators have failed to find any compromise on these issues for many months.

Today, foreign exchange market traders will also wait for the results of U.S. stimulus vote as Republicans and Democrats managed to reach a compromise deal over the weekend.

Technical Analysis

GBP/USD managed to get below the 20 EMA at 1.3380 and is trying to settle below 1.3350. In case this attempt is successful, GBP/USD will head towards the next support level near 1.3320.

A move below 1.3320 will push GBP/USD towards the support at 1.3300. If GBP/USD declines below 1.3300, it will get to the test of the next support level at the 20 EMA at 1.3280. A successful test of this level will open the way to the test of the next support at 1.3250.

On the upside, the nearest resistance level for GBP/USD is located at the 20 EMA at 1.3380. If GBP/USD manages to settle above the 20 EMA, it will head towards the next resistance at 1.3400.

A successful test of this level will push GBP/USD towards the resistance at 1.3440. In case GBP/USD settles above 1.3440, it will move towards the next resistance level at 1.3485.

For a look at all of today’s economic events, check out our economic calendar.