Sentiment for the reopening of the UK economy this week was seen as failing to restore the movement of the Pound, instead the British currency depreciated lower against the US dollar in early trade in the week.
It is likely that concerns about the rapid contagion of the new Covid-19 variant are dampening investor confidence with expectations that the UK economy will struggle to head towards recovery.
On the other hand, the US dollar gained an advantage in such a risky market situation to strengthen and put pressure on European currency trading.
On the chart the GBP/USD pair has displayed a decline on Monday below the 1.37000 level.
Continuing on Tuesday's trading yesterday, the price continued its lower decline testing the 1.36000 support zone. The last time the zone was tested before this was last February.
From last weekend until yesterday, the price movement remained below the Moving Average 50 (MA50) barrier level on the 1 -hour time frame for bearish trend signals.
A lower decline will be expected by investors if the price falls below the level of 1.36000 with the latest lows target reaching 1.35000.
For a bullish situation, the 1.37000 zone is seen to be a resistance for the price before continuing the decline.
If the price breaks the zone, this will again signal a recovery for the price to make a rise again.
UK economic sector data to be published over the weekend will be the focus of investors to assess the reaction of the Pound’s movements in the market.
