Sterling Remains Highly Volatile After Successful Brexit Deal; Jan 04, 2021
Sterling Remains Highly Volatile After Successful Brexit Deal
The long awaited Brexit Deal is finally to an end and now Britain is free to trade across the globe. Secondly, increasing Covid cases are the major concern over the Brexit talk.
Responsible Factors for the extreme volatility in GBP Parity:
- The new trade agreement keeps free trade moving between U.K. and the Euro.
- The final agreement maintains some co operation on areas such as security, aviation and science.
- The companies may face new issues regarding Custom declaration, border checks and other supporting paper works.
- Britain’s Financial Conduct Authority (FCA) – It would allow UK market participants to trade swaps on EU venues until the end of March to avoid disruption in markets.
- On the other side, tougher lockdown restrictions were probably on the way as COVID-19 cases keep rising in the Britain.
- England is currently divided into four tiers of restrictions where social mixing is restricted and restaurants and pubs are closed.
GBP/USD: The Sterling spikes down is U.S. session and gives more than 150+ PIP downside movement. The pair made intraday high at $1.3703 and low at $1.3561 mark. A sustained close below $1.3581 will check key supports around $1.3522, $1.3487, $1.3457 and $1.3396 mark respectively. Alternatively, key resistances are seen at $1.3722, $1.3792 and $1.3849 marks.
Take a look and do trade wisely!