Volatile 2019 for Pound
The pound has shown some strong swings in December, a microcosm for the pound’s fortunes in 2019. GBP/USD fell as low as 1.1958 in early September, when Brexit uncertainty was at a fever pitch and the political scene in London was one of disarray. Only three months later, the pound soared above the 1.35 level, as the markets were elated with Boris Johnson’s surprisingly easy election win. This has paved the way for a Brexit departure at the end of January. However, we could well see more volatility from the currency early in the New Year, as the transition period after Brexit promises to be uneasy and difficult, as London and Brussels are already arguing whether 11 months is enough time to conclude a new trade deal.
GBP/USD is currently just above the 1.3100 line, which had served as resistance until Monday. Above, there is resistance at 1.3180, which is protecting the 1.32 level. On the downside, we find support at 1.3030, followed by the round number of 1.30.