British Pound (GBP) Latest - Brexit Talk and Positive Covid Vaccine News Pump Sterling Higher
Brexit Outlook and Sterling (GBP/USD) Price, Analysis and Chart:
- Brexit talks continue against a positive backdrop.
- AstraZeneca vaccine may be a game-changer.
- FTSE 100 eyes a fresh multi-month high.
Sterling is pushing higher against a range of currencies in early trade, boosted by talk that PM Boris Johnson may intervene this week to get EU/UK trade talks over the line, while the AstraZeneca/Oxford University vaccine results look very promising.
The EU/UK trade negotiation mood music seems to have changed over the weekend with positive noises now being heard. UK PM Boris Johnson is said to be set to intervene this week and talk with President of the European Commission Ursula von der Leyen to get a deal over the line, but with the usual caveat of not agreeing to a deal at any price. If both sides can somehow find a middle ground after years of wrangling and rancor, then a deal is looking much more likely than it has so far. Sterling traders seem to have a more positive take this morning, pushing EUR/GBP back below 0.8900 and towards multi-week support, while GBPUSD is back above 1.3350, a level last seen at the start of September.
GBP/USD Daily Price Chart (February – November 23, 2020)
IG client sentiment data show35.56% of traders are net-long with the ratio of traders short to long at 1.81 to 1.Positioning is less net-short than yesterday but more net-short from last week. The combination of current sentiment and recent changes gives us a further mixed GBP/USD trading bias.
AstraZeneca/Oxford University Vaccine News
Results released today by AstraZeneca show that their Covid-19 vaccine is highly effective in preventing the disease. Results from the phase three trial showed that the vaccine was 70% effective when two full doses were given one month apart, while this number rose to 90% when a half dose was given at the start and a full dose is given one month later. While these efficacy figures do not quite match test results from Moderna and Pfizer, the AstraZeneca vaccine is substantially cheaper and does not need to be transported in refrigerators, making distribution easier. The UK government has already ordered one hundred million doses of the vaccine which, if approved, could see an inoculation program rolled out at the start of next year.
The FTSE 100 is in positive territory this morning, despite Sterling’s strength and is within 100 points of making a fresh five-month high. The daily chart remains positive with the 20-day simple moving average moving higher through the 50- and 200-day sma. Short-term support is likely around 6,300 - 6,310, while a break of 6,464 will see a new multi-month high printed.
FTSE 100 Daily Price Chart (February - November 23, 2020)
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