The GBPUSD relentless rally is continuing today after the UK became the first country to approve the Pfizer/BioNTech vaccine. The pair is trading at 1.3428, which is the highest it has been since September this year.
The country will now become the first to deliver the shots, which uses a relatively new technology known as mRNA. In clinical tests that involved more than 40,000 people, the companies found that the vaccine was positive in preventing the disease.
After authorisation, Downing 10 spokesperson said that the vaccine will now be available starting in the coming week. Still, there are questions about the safety of the vaccine considering that other regulators in the US and EU are still doing the inoculation.
A vaccine is a positive thing for the UK because it will provide a boost to the overall economy. It is also a positive thing for the GBPUSD because it will push the greenback lower. Indeed, the US dollar index has dropped to the lowest level in 2.5 years.
From an economic data standpoint, there will be no data from the UK today. Instead, focus will be on the ADP private payroll numbers scheduled for 13:15 GMT today. Economists expect the data to show that the economy added more than 410k jobs in November, higher than the 365k added in the previous month.
GBPUSD technical outlook
The GBPUSD price has been in an overall upward trend since March this year when it reached a multi-year low of 1.1417. Today, the pair is trading at 1.3438, which is 17% above the year-to-date low.
The pair is also above the ascending yellow trendline that connects the lowest levels in March, June, September, and November. Further, the upward trend is supported by the short and medium-term moving averages.
Similarly, the Relative Strength Index (RSI) is rising and is slightly below the overbought level of 70. This implies that the rally has more room to run. Therefore, like the EURUSD, there is a possibility that the pair will continue rallying.
GBP to USD technical chart
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