The first days of May suggest the month will be risk-off for the GBP/USD. Here is why.
Turkish lira continues to weaken
Yesterday, Turkey's election authorities canceled the results of the municipal election after a win of the opposition CHP party. The decision was made after several attempts by the current president Recep Tayyip Erdoğan to recount the result of the elections. It provoked streets riots in Istanbul. Such political instability pulled the Turkish lira down.
At the moment, USD/TRY is targeting the resistance at 6.2. If the lira gains back strength, the pair will fall back to the support at 5.99. If this level is broken, the next key support will lie at 5.94. From the indicators' picture, ADX shows that the bullish market is overheated and RSI is moving within the overbought zone. If it leaves this zone, it may bring a selling opportunity.
UK Prime Minister was placed in the intensive care. As a result, the British pound plummeted dramatically today.
Let’s consider the best and the worst-performing assets as Monday’s session kicks in.
The European Central Bank will publish the monetary policy statement with the interest rate decision on January 21, at 14:45 MT time.
Joe Biden is going to unveil a Covid-19 relief package of about $2 trillion. After this announcement, the 10-year Treasury yield rose, adding support for the USD.
The US dollar’s weakness offered a boost to emerging-market currencies and oil.