KEY POINTS OF THE ARTICLE:

• General Background: Negotiations on Brexit and in the United States are continuing

Currency Table-Time Horizon: Daily

RESISTANCE

SUPPORT

GENERAL CONTEXT: NEGOTIATIONS ON BREXIT AND THE UNITED STATES ARE CONTINUING

The book is being held this morning because the game is not over. The European Union and the United Kingdom have agreed to continue negotiations on trade agreements beyond yesterday's deadline. A call between British Prime Minister Boris Johnson and European Commission President Ursula von der Leyen has given new impetus to the drive to reach an agreement, with both sides saying they will make “an extra effort”. As a result, new hope for the British currency and optimism returns... the saga continues

This time, the United States has also been extended by one week. In the United States, lawmakers are expected to pass a one-week spending bill to fund the government, but the House indicated that any other project would require agreement on a broader fiscal stimulus package. Unfortunately, very little progress has been made and Senate Republicans say they do not have majority support for the current bill. If an agreement cannot be reached within a week or two, we could see big year-end losses in currencies and stocks.

The worry is that December 31 will be a horrible day for a lot of Americans. Without a new stimulus package or extensions, millions of Americans will lose their additional weekly unemployment check of $300 to $600

The euro continues to rise despite the closure of non-essential stores in Germany. Employers will be asked to close workplaces and schoolchildren will be encouraged to stay home. The country has fought against the second wave of the virus and is lagging behind many of its neighbors in keeping infection rates under

USD/CAD hit its lowest level in 2.5 years on Thursday before touching a short-term low on Friday. The pair is heavily oversold and is expected to recover more strongly. The New Zealand dollar also fell despite stronger activity in the services sector. The Australian dollar, on the other hand, maintained its gains.

TODAY'S CURRENCY: GBP/USD: REBOUND ON THE BULlish OBLIQUE

The pound against the dollar rose again this morning welcoming the continuation of negotiations. The bullish slant on Friday played its supporting role perfectly and stopped the correction installed in recent days. However, to confirm the continuation of its rise, the pound will have to cross the strong resistance zone around 1%. In the meantime we will remain neutral.

A break in the oblique would be a bearish signal with the first objective 1.2850.

Evolution of the pound against the dollar in daily data: