Pound and Indian variants of the virus
The UK may reconsider plans to ease COVID-19 rules on June 21 amid concerns over a new Indian variant. Concerns about delaying reopening come despite assurances that existing vaccines are coping with the variant. The Prime Minister of the United Kingdom Boris Johnson was calm on the issue, but the concerns of the Minister of Health Matt Hancock could now be taken over.
Limited reopening means less economic activity and additional pressure on the pound. Investors are re-evaluating reports from Federvval Reserve sessions and their significance. It is necessary to mention that the chairman of the Federal Reserve, Jerome Powell, and most of his colleagues have supported the current policy unchanged for some time and that they see the economy as a “long way.” We also had economic news for the pound this morning: Production orders in the UK recorded the strongest growth since the end of 2017. The results of a survey by the Confederation of British Industry showed on Thursday.
According to the latest survey results on industrial trends this was the highest since December 2017, the total balance of order books rose to +17 percent in May from -8 percent in April.
Looking at the graph on the four-hour time frame, we can do the following technical analysis. The GBP/USD pair moves in an ascending channel, with a certain pull to the bottom line. After bouncing off the top line, we have the current pullback, which has lowered the pair below the moving averages of the MA20 and EMA20 as we sit on the MA50. The break below leads us to the bottom line at MA200 and EMA200 at 1.40000. Looking at the MACD indicator, we are in a bearish trend with current sideways movement.
