Welcome trading legends,
In this post, we’ll be trading the EUR/GBP asset using the signals provided by the Tools Trades website and the IQ Option broker. Be sure to stick to the end of the video as I’ll be sharing a special promo code with you.
Allow me to explain why I’m trading this particular asset.
Forex market operators have demonstrated considerable indecisiveness as a result of Brexit-related uncertainties. The new key deadline has shifted to 10 December, the date for the last European Council of the year, which is primarily expected to raise questions over post-Brexit trade relations between the EU and the United Kingdom. If there is to be an agreement between the two parties prior to 31 December 2020, this is definitely the most opportune date for it to be approved by the EU’s heads of state or government.
While visibility over Brexit remains minimal, it has already become clear that the United Kingdom will be one of the developed economies to be worst hit by the pandemic. According to projections, GDP should fall by 11.3% in 2020 (an unprecedented drop over the past 300 years) and it will take until the fourth quarter of 2022 before GDP returns to its pre-crisis level. A long period of uncertainty beckons for the UK, the result of which could be a long depreciation phase for the country’s currency.
The sentiment is a key driver for the pound to euro trend. The uncertainty surrounding negotiations between the EU and the UK over Brexit has pushed down the value of sterling. In the meantime, concerns around the aftermath of Covid-19 on the UK economy, which has been hit harder than the eurozone, have prompted traders to short the pound against the euro.
With the pandemic driving unprecedented economic stimulus, traders looking at making a pound to euro projection should consider the impact of European Central Bank (ECB) and Bank of England policy on monetary stimulus, as lower interest rates make investment less attractive.
Macroeconomic factors including GDP, services and manufacturing activity, unemployment, and consumer price indices provide indicators that also drive the currency markets and will influence the pound against the euro forecast for 2021.
However, the forex market has become more volatile in 2020, with the GBP/EUR rate hovering around 1.20 in February, right before plunging to 1.06 in March as the UK went into lockdown to slow the spread of Covid-19. The rate rose to 1.14 in April but fell back to 1.08 in September, as a spike in coronavirus cases hit sterling and the status of Brexit negotiations raised the possibility of the UK leaving without a deal at the end of the year.
UK GDP increased by 2.1 percent in August, well below expectations of 4.6 percent, and industrial data was weaker than expected with a 6.4 percent decline. Economic data continues to raise questions about the outlook for the underlying recovery in the UK, although there were reports that UK Chancellor Rishi Sunak could introduce a local furlough scheme, forex analysts at Sucden noted.
The shape of the economic recovery will influence the pound to euro forecast into 2021.
Only time remains to see what will happen but as you can see the signals from the Tools Trades website have worked!
The promo code that you see on the screen will give you more trading signals if you use them on the Tools Trades website.
Be sure to watch my other videos on the channel and read the blog page so you learn more. If you want more videos like this be sure to like and subscribe. As we march into the New Year I wish all of you a great trading year ahead with many profitable signals.
May the Forex be with you.
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