​Pound Sells off as London Put in Emergency Lockdown

WikiFX News (21 Dec.) -GBP/USD opened this week heavily lower, hitting a four-session low after retreating 0.9% at one point to the 1.34 handle. The reason is scientists have proved that the new Covid-19 variant identified in the UK is 70% more contagious than the original strain.

The new coronavirus variant is “out of control,” said the UK Health Secretary Matt Hancock. Boris Johnson has announced new lockdown measures for London and parts of South East.

According to analyses, the new variant may be up to 70% more transmissible and may be in other countries as well. Several countries have suspended travel links to the UK. In the wake of the news, the pound opened this Monday trading with a sell-off.

Whether the new variant will hinder the hanging Brexit is unclear. Since the two sides in Saturdays negotiations remained divided over key issues, the market could see another wave of pound selling amid Brexit uncertainties.

At present, GBP/USD may find some key support at 1.3200-1.3300, where a breach below may open the door for a downside test towards the 1.3000 or even 1.2800 level.

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Chart: Trend of GBP/USD