Last week, there were sharp swings in USDJPY, a decline in oil prices, and a surge in Tesla stock. What's next?
Pound dropped as Boris Johnson’s health got worse
Instruments to trade: GBP/USD, EUR/GBP, GBP/AUD, GBP/CAD
Almost two weeks ago Boris Johnson tested positive for the virus, yesterday his health deteriorated and he was placed in the intensive care. As a result, after such negative news the British pound plummeted dramatically today.
It created a political uncertainty in UK, as it would make things even more complicated than it was in such a fragile period for the country as struggling with the coronavirus and getting ready for future Brexit trade negotiations.
All the confidence that the British pound gained at the start of the week was immediately vanished. The market reacted so fast as the virus spread could be shrinking in the USA and Europe, and risk appetite of investors became stronger.
Let’s look at the EUR/GBP chart. The pair had been declining since March 19. However, it hit the 200-day Moving Average at the point of 0.8755 or 61.8% Fibonacci retracement level on March 3. Then it reversed and went upward. The resistant line is on 50% Fibonacci level or the 0.89 mark. The next one is on 38.2% or 0.905.
Geopolitical factors and inflation remain the main drivers of financial markets. Let’s see how to use that in trading!
Have a look at the key financial instruments on Monday, February 28. Geopolitics is currently on all news frontlines. Western nations escalated sanctions on Russia for the invasion of Ukraine.
The United States will publish the Preliminary GDP on Thursday, May 26, at 15:30 GMT+3.
The Reserve Bank of New Zealand will publish a monetary policy report and make an update on the interest rate on May 25, at 05:00 GMT+3.
The Australian Bureau of Statistics will announce the updated Unemployment Rate and Employment Change data on Thursday, May 19, at 04:30 MT.