The British pound held steady on Monday morning amid a low-volume environment. The currency has been rising as investors adjust their expectations of the Omicron variant. While the number of Covid-19 cases in the country has been rising, evidence shows that the number of deaths has not increased dramatically. This is in line with two reports published last month that showed the Omicron variant is milder than Delta. Therefore, investors believe that the Bank of England (BOE) will embrace a relatively hawkish tone in the coming year.
American futures tilted higher on Monday, even after the latest flight cancellation numbers. During the Christmas weekend, it was reported that more than 6,000 flights were cancelled globally. This happened as more employees in airlines called in sick amid a surge in Covid-19 cases. Some of the companies that cancelled flights were Delta, Southwest, United, and American. Other leading global airlines that cancelled flights were China Eastern and Air India. These cancellations will most definitely affect company results.
The economic calendar will have no major events today as most investors remain at home with their families. Some countries like the UK, Australia, Canada, and New Zealand will also be on holiday today. Therefore, the volume will be significantly low. Still, investors will be focusing on the cryptocurrency industry today. Most coins like Bitcoin, Ethereum, and Litecoin made a bullish breakout on Friday, although the upward trend has slowed.
GBPUSD
The GBPUSD pair has been in a strong bullish trend in the past few days. It is trading at 1.3391, which is a few points below last week’s high of 1.3437. On the four-hour chart, the pair has formed a break and retest pattern, since it is currently at the key support at 1.3391. This price was the highest level on December 16. It is also slightly above the 25-day and 50-day moving averages. Therefore, there is a likelihood that the pair will keep rising today.
EURUSD
The EURUSD pair is in a tight range as investors focus on the Covid situation in Europe and the US. The pair is trading at 1.1315, where it has been in the past few days. It is slightly below the 25-day and 50-day moving averages. It has moved between the horizontal channel shown in red, while the Relative Strength Index (RSI) is at the neutral level. Therefore, the pair will likely remain in this range for a while.
XBRUSD
The XBRUSD pair has been in a strong bullish trend in the past few days. It is trading at 76.40, which is the highest it has been since December 9. It has even moved above the key resistance level at 76.0 and the 25-day moving average. The RSI and the MACD have also been rising. Therefore, the pair will likely keep rising as bulls target the key resistance level at 77.
