22.01.202112:55 Forex Analysis & Reviews: Lockdown in UK is not expected to end soon

The third restrictive measures against the UK coronavirus may last until the summer, as the government sees no other way out. They say that it is too early to think about easing the restrictions.

Prime Minister Boris Johnson and Interior Minister Priti Patel are no longer considering getting citizens back to normal this spring, even if the country's mass vaccination program is ongoing.

Alternatively, the government has focused on intensifying compliance with the current restrictions amid concerns that too many people are still disregarding the rules, making it difficult to control the spread of the virus.

Ministers are considering paying £ 500 each to anyone who tests positive for COVID-19 to persuade more people with symptoms to come forward for testing. Such an extraordinary proposal could cost the treasury about 2 billion pounds a month. All this is done so that citizens can overcome the fear of losing their jobs if they are forced to self-isolate themselves with a positive test.

At the same time, the Home Secretary announced that new police fines of £ 800 will be imposed on people caught attending house parties. Ms. Patel said that this fine for going to parties will double for each further violation to a maximum fine of £ 6,400. In this case, party organizers can be fined 10 thousand pounds.

Earlier, Journalists asked Boris Johnson if the restrictive measures could last until summer, to which he replied that he did not exclude this possibility. He also warned about the higher risk of a new strain of coronavirus than the previous one.

Due to the restrictions, most shops, restaurants and schools are closed. Citizens were also told to stay at home unless very necessary. These restrictions threaten to push the economy into another recession after it experienced its worst recession in three centuries.

The latest data in the United Kingdom showed that 1,290 people died from COVID-19 in a day, accounting for 95,829 people, which is the highest death rate in Europe.

Following the above material, the coronavirus pandemic will continue to put pressure on the UK economy, which might have a negative impact on investments, business and the national currency.

What happened on the trading chart?

The pound sterling managed to update the local high of the mid-term upward trend yesterday, after consecutive price rebounds from the three-week high. The speculative mood covers all other problems associated with the British currency, such as economic consequences of COVID-19 and Brexit, as well as the massive overbought status.

It is worth noting that speculators cannot eternally block the attention of pressing problems, as everything can end with another collapse of the pound.

At this time, the quote is not just at the high. It also follows the peak of the previous medium-term trend from 2018, or else, speculators will be scared, which will lead to a sharp decline in long positions in the market.

To put it simply, the range of 1.3750/1.4000/1.4350, which reflects the slowdown of the previous trend, could be decisive in the market.

What is currently happening in the market?

The quote moves below the 1.3700 coordinate, which provides confidence to sellers and increases the chances of repeating the pattern associated with the level. In this case, we are talking about a price rebound and a rise in the volume of short positions.

If the natural basis coincides, a price decline will be likely to the value of 1.3610-1.3550.

An alternative scenario of the market development will be considered after the prices holds above 1.3750 in the daily TF ,which will lead to the final movement in the range from 2018.

Key levels

Resistance zones: 1.3750 **; 1.3850; 1.4000 ***; 1.4350 **.

Support zones: 1.3610 *; 1.3300 **; 1.3000 ***; 1.2840/1.2860/1.2885; 1.2770 **; 1.2620; 1.2500; 1.2350 **; 1.2250; 1.2150 **; 1.2000 *** (1.1957).

* Periodic level

** Range level

*** Psychological level