One of the biggest beneficiaries of Boris Johnson’s comfortable victory in last week’s election was the British Pound, which jumped from $1.31 to $1.35 (GBP/USD) on Thursday, largely because of reduced uncertainty of the Brexit process, where the Prime Minister would supposedly have more room to negotiate with the European Union an agreement allowing a peaceful exit from the United Kingdom from the European bloc. However, this seems to have been a poorly worded hope, as Boris was soon to punch the table by setting the threshold for Brexit in December 2020, with or without agreement.
It is this latter possibility of the no deal that is pushing the GBP/USD pair today to a similar level to the pre-election and with a bearish outlook. At the technical level the short-term future also does not appear to be very optimistic as the active asset broke the rising channel, which is often a sign of a correction below its bottom line, much like a bursting mini bubble.
