GBPUSD was doing very well for a long time. However with sentiment turning towards the US dollar 💲 we eventually saw a breakout of the wedge formation. How low can this go❓
The British pound was doing very well in January partly on the back of relief after clinching the EU divorce deal which was not that certain towards the end of 2020. UK also enjoys a fairly good vaccination pace which may help the economy rebound sooner. However, at the same time present restrictions are among the most stringent and the level of activity is low. Furthermore, rising bond yields in the US help USD and the EURUSD pair is testing 1.20 with a good chance of breaking lower. This adds pressure to GBPUSD and as we can see the pair broke out lower from the wedge formation and also broke the short term support zone. With no obvious support in sight, can it go all the way down to the base of the wedge at 1.32?
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