GBP has been rocketing higher in the session, pushing towards six consecutive weeks in the green. The bulls have been moving aggressively to the north, influenced by Brexit deal optimism and risk appetite across the markets.
Let’s now take a look at just how far higher GBP/USD can push…
GBP despite the dips along the way has been continuing to push firmly to the upside for the last going on six weeks. Looking at specifically GBP/USD the moves have been tremendous, having gained a whopping 600 pips+ within the noted period. Further down we will look technically at a clean structure that points to greater moves north.
Optimism that Britain and the EU will get something agreed before the end of the year is helping the pound drive north. The latest comments from a source within the negotiations noted there may be enough progress to agree on a deal in the next few days.
GBP is also being supported by the general theme of risk appetite, with vaccine optimism behind a large influencer. Announced on Wednesday that Britain is becoming the world’s first country to approve the Pfizer-BioNTech COVID-19 vaccine.
Of course there is the potential that both Britain and the EU do not agree a deal, which would be catastrophic. Especially given that the markets right now have completely priced out that possibility, they are so focused and optimistic that a deal will be done. All of the latest commentary, despite some of the mixed messages from politicians, do still at least point to gradual progress.
GBP/USD technical observations
GBP/USD price action via the weekly chart view at the time of writing is penetrating through a heavy supply region 1.3450-1.3500, and a potential neckline of an inverse and head shoulders structure. A break above and even a retest for additional confirmation would be attractive via the weekly for the upside bias. In terms of the target area, a move into 1.4000-1.4100 would be of interest.
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