The British Pound had fallen sharply last week after news that the European Union was considering terminating the Brexit trade deal if the rift with the UK over the Northern Ireland protocol escalated. Investors had immediately pulled out of their investments in pounds for fear of such sanctions. At present, there is no single reason to push pounds higher in the coming weeks if the British Prime minister does not forsake such decisions. We might experience more declines for pounds in the coming weeks except a positive compliance is given by the British government over its rifts with Northern Ireland. On the other hand, Crude Oil have soared higher last week might witness a little retracement to the previous support at $82.50 before continuing with the upward movement predicted by UBS to reach $90 before March 2022.
Fundamental Analysis and Forecast for GBPUSD.
The British Pounds had witnessed a great fall last week after the European Union revealed that they are set to terminate the post-Brexit trade deal if the U.K. government does not abandon it's decision to pull out of its commitments with Northern Ireland.
According to the reports from the European officials and others familiar with the matter; the European Union had made known that they are set to terminate the post-Brexit trade deal if the U.K. government pulls out of its commitments over Northern Ireland,
This decision comes immediately after British Prime Minister Boris Johnson has threatened to unilaterally suspend parts of the Northern Ireland Protocol, which governs trade between the province and the rest of the U.K., using the powers granted in Article 16 of the pact. European officials have been quick to backfire that the EU would be forced to terminate the post-Brexit trade deals with the UK if ever they attempt such actions. This has badly affected the British Pounds last week.
As can be seen above, Pounds following this news for the cancellation of trade deals with the EU fell hardly from 1.3890 to a new low at 1.37355.
Presently the pounds is struggling for a recovery at this point. Except the UK rescinds this decision, the EU will have no other option than to proceed with such trade deals cancellation this will lead to further decline for the pounds in the coming weeks. At present there exists no good incentives for investors to buy pounds as they await the final decision on this matter. Pounds will have to range further this week except a positive attitude compliance comes from the Prime minister.
Fundamental Analysis and Forecast for Crude Oil
Crude oil has continued with its upward movement uninterrupted all through the month of September and October. The price has created a new All time high last week at $84.15 per barrel.
Observing the many Economic factors favoring the rise of crude oil, UBS forecasts that the price of Brent oil will likely reach $ 90 per barrel from December 2021 to March 2022 and will drop to $85 per barrel for the rest of 2022.
However, following the current rejection at the present resistance created last week at $84.15, it is more likely that Crude Oil will be retesting the previous support at $82.50 before ever continuing the upward movement.
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