Pound rally continues

By 27/01/2021News
Morning Stock News

Gold  1849,775

EURUSD   1,2164
(+0,02 %)

DJIA  30764,50

OIL.WTI  52,975

DAX   13880,50

We have recently had a discussion with our subscribers about the outlook for the English pound sterling. It was about the fact that after the “successful completion” of Brexit and the start of mass vaccination, the English currency has started to look extremely bullish, from a fundamental point of view.



So far, our predictions are confirmed. Let’s take a closer look at the chart above. We see a rising channel, which is almost 45%. There is also resistance at the level of 1.375, which the pound cannot overcome for the last 4 trading days. A lot of stops accumulate behind this level. If this level is broken through, the price can go very quickly towards the round level of 1.40.
What could prevent such a development? From the technical point of view, in the short term, it is a fall to the lower boundary of the channel. And from the trading point of view, the risk is as follows. This channel and trend has already been identified by a large number of funds and speculators. What’s more, the fundamental factors contributing to the rise in price are also quite obvious. The question is, how many bulls are present in the market who have not yet joined the trend? If they are almost all already “in”, then there will be no new buyers physically in the market pushing the price up.
It is unclear whether the dollar will fall further against the pound.
However, it is almost certain that the EUR will fall against the Pound. We recommend everyone to open the daily chart and pay close attention to it. Moreover, since our last newsletter, the fundamentals for the decline of the pair have only increased. They are related to the massive introduction of lockdowns in European countries.

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