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Lawrence McOchillo

Can the GBP/USD pair rally to its December 2019 highs in Q1 2020?

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The GBP/USD currency pair rallied to a 19-month high of 1.3516 on 13th December 2019 after the historic British snap general election that was won by Boris Johnson. The Conservative Party secured an 80 seat majority in the House of Commons ending the Parliamentary stalemate that had ensued following the 2017 snap general election where it failed to secure a meaningful majority. Since then, the pair fell over 600 points to a low of 1.2906 and has since been trading below 1.3300.

The cable has to break above the 1.3300 resistance level before it can reach the 1.3500 high, which has proven difficult up to date. However, things could change if the post-Brexit talks between the UK and EU are successful and the UK secures a deal before the December 31st deadline. The pound could breach this crucial level much sooner if the UK secured comprehensive trade deals with the US and other major trading partners in the near future. A recovery in the UK economy could also trigger a major rally by the pair.

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