GBP/USD Analysis and Talking Points
- Brexit Focus Returns for GBP/USD
- GBP/USD Under Modest Pressure
- Coronavirus Weighs on Risk Sentiment
Rising concerns over the spread of the Coronavirus, which has seen the number of cases rise substantially in both Italy and South Korea has seen risk sentiment come under pressure with investors flocking to safe-havens. Despite this however, GBP has typically been unfazed from the impact of coronavirus. As such, with the EU looking to sign off its negotiating mandate for trade talks to begin from March 2nd, the focus is back onto Brexit. In turn, tensions between the UK and EU are likely to drive price action in the short term with a rise in tensions sparking a pullback in GBP crosses.
| Change in | Longs | Shorts | OI |
| Daily | 1% | 1% | 1% |
| Weekly | -1% | -9% | -3% |
GBP/USD Technical Analysis
GBP/USD is under modest pressure this morning and looks to make a test for the 1.2900 handle. Momentum remains soft with the RSI also heading lower, as such, focus is on for a potential move towards support at 1.2882 (38.2% Fib retracement), which has largely remained firm. However, closing break below leaves the currency exposed to a larger pullback.
GBP/USD Price Chart: Daily Time Frame
Source: IG Charts
--- Written by Justin McQueen, Market Analyst
Follow Justin on Twitter @JMcQueenFX
