The British pound is under pressure

The British pound was under pressure of the publication of weak data on retail sales in the UK for December, thereby increasing the correction for the British pound relative to major competitors. Along with a decrease in interest in the pound, the market keeps fears over political risks in the US and the euro zone, which in turn pushes investors to seek refuge in alternative assets.

Thus, at the beginning of the day, safe haven assets are popular on the market: the yen, the franc and gold, but with the positive opening of the stock indices in Europe, it is expected to slow down this dynamics. If only the indices of Europe do not change the direction. Political fears over the euro area and the US remain virtually equivalent, so the nearest alternative to the euro and the dollar may be the British pound, which may be limited to weak statistics.

In such conditions, the descending expectations for the EUR/GBP pair remain in place. The pound is limited to the oversold of the American, but the GBP/USD pair maintains its potential to strengthen, limiting itself to highs.

Fig. GBP/USD H4. The current price is 1.3920.

Hanzenko Anton