- GBP/USD has been holding onto high ground as Britain's vaccine campaign continues at full speed.
- Markets are focused on the Federal Reserve's decision later in the day.
- Wednesday's four-hour chart is pointing to further gains for the pair.
The UK has surpassed 100,000 coronavirus deaths – but has also vaccinated over 10% of the population with at least one shot. Investors have been focusing on the latter figure and pushing the pound higher, especially as the EU is battling AstraZeneca around doses supplies.
Apart from proceeding at full speed on the inoculation front, Britain's caseload is also falling, providing hope that the lockdown is removed sooner rather than later. Wednesday's publication of upbeat jobs figures – the Unemployment Rate remains depressed at 5% – is also supporting sterling.
Source: FT
The focus now shifts to the US Federal Reserve. Investors are keen to know if the bank's next step is cutting down on its bond-buying or rather ramping it up. On the one hand, the US is also expanding its vaccination campaign and President Joe Biden is advancing his stimulus bill. Moreover, exuberance in stock markets – such as in Gamestop – may also support cutting down support from the Fed.
On the other hand, recent economic data has been weak. The US lost 140,000 jobs in December and Retail Sales tumbled in both November and December.
See:
- Fed Preview: Fearing market froth or boosting Biden's stimulus? Three scenarios
- US Federal Reserve Preview: Neither an optimist nor a pessimist be
Overall, the pound has reasons to rise but the next moves heavily depend on the Fed.
GBP/USD Technical Analysis
Pound/dollar remains in an uptrend, benefits from upside momentum while the Relative Strength Index is still below 70 – outside overbought territory.
Bulls have already pushed GBP/USD to a new multi-year high of 1.3758. Above this cap, the next barrier is the round number of 1.38. It is followed by 1.3830 and 1.40, levels last seen in 2018.
Support awaits at 1.3720, the daily low. Further down, it is followed by 1.3670 and 1.3610, the weekly low.
GBP/USD Price Forecast 2021: Cable braces for calendar comeback amid three exits
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
AUD/USD failed just ahead of the 200-day SMA
Finally, AUD/USD managed to break above the 0.6500 barrier on Wednesday, extending the weekly recovery, although its advance faltered just ahead of the 0.6530 region, where the key 200-day SMA sits.
EUR/USD met some decent resistance above 1.0700
EUR/USD remained unable to gather extra upside traction and surpass the 1.0700 hurdle in a convincing fashion on Wednesday, instead giving away part of the weekly gains against the backdrop of a decent bounce in the Dollar.
Gold keeps consolidating ahead of US first-tier figures
Gold finds it difficult to stage a rebound midweek following Monday's sharp decline but manages to hold above $2,300. The benchmark 10-year US Treasury bond yield stays in the green above 4.6% after US data, not allowing the pair to turn north.
Bitcoin price could be primed for correction as bearish activity grows near $66K area
Bitcoin (BTC) price managed to maintain a northbound trajectory after the April 20 halving, despite bold assertions by analysts that the event would be a “sell the news” situation. However, after four days of strength, the tables could be turning as a dark cloud now hovers above BTC price.
Bank of Japan's predicament: The BOJ is trapped
In this special edition of TradeGATEHub Live Trading, we're joined by guest speaker Tavi @TaviCosta, who shares his insights on the Bank of Japan's current predicament, stating, 'The BOJ is Trapped.'