UK authorities have announced the discovery of a new strain of SARS-CoV-2, which is spreading faster than the previous strain of coronavirus.

As a result, London will be required to abide by tough regulations starting Wednesday, as the government seeks to contain the outbreak as quickly as possible.

Pubs, bars and restaurants will be closed, with the exception of those serving takeout. Theaters, museums and cinemas will also be closed to the public.

But aside from the UK, many other European countries are under strict lockdown as well. This is because COVID-19 is still out of control.

Meanwhile, regarding Brexit, negotiations have resumed on Monday, as both parties insist on concluding an agreement before December 31.

EU chief negotiator Michel Barnier said a deal will be signed if both sides resolve key differences.

To date, there are two main issues holding back the deal: the so-called "level playing field" and fishing rights. Of the two, the level playing field is what is truly fundamental.

Level playing field - fairness in which both sides will have to face the same regulations when selling to the EU single market.

The European Union is concerned that the UK may cut labor or environmental standards to compete with European businesses. Meanwhile, the UK wants to make sure that it has the freedom to set its own rules as a sovereign state, even if they are at odds with the EU, because that was the point of Brexit.

Based on the recent statements of Barnier, the UK seems to be ready to make concessions regarding the issue. Therefore, speculators are inflating expectations for a positive outcome.

So, in yesterday's trading chart, activity is very high in the market, resulting in a very huge price gap in the morning (145 pips). After that, there was another upward move by about 155 pips.

Market dynamics reached 155 points, which is 30% higher than the average level. And if we also take into account the price gap, we will get the highest value since the beginning of November.

To add to that, in the daily chart, a medium-term upward trend can be seen, the local high of which is 1.3537. And taking into account the recent growth of the pound, the pullback from 1.3537 to 1.3134 was 77%.

Regarding economic reports, the UK published data on its labor market today, which indicates that the unemployment rate rose from 4.8% to 4.9%, a bit lower than the expected 5.1%. Jobless claims have jumped to 64.3 thousand, but due to the slow growth of unemployment, the figure did not look so bad.

The market did not really react to this information, especially since speculators are waiting for Brexit news before jumping in the market.

Therefore, in the trading chart, the pound stopped moving at 1.3310 / 1.3350, but if speculators became active again, a new round of acceleration may occur. The most optimal trading tactic is to work for a breakout from the above-mentioned range.

- Open long positions from 1.3355 to 1.3400

- Open short positions from 1.3300 to 1.3265-1.3220.

But note that news on Brexit is likely to trigger speculative surges in the market.

Any good news will lead to the strengthening of the pound, while negative news will result in its drop.

Indicator analysis

Looking at the different segments of the time frames (TF), it is clear that the indicators in minute and hourly periods show variable signals because of the consolidation, while the daily period signals BUY due to the correction.

Volatility is measured relative to the average daily fluctuations, which are calculated every Month / Quarter / Year.

(The dynamics for today is calculated, all while taking into account the time this article is published)

Volatility is currently at 38 points, which is still very little. But as soon the range 1.3310 / 1.3350 is broken, the first round of acceleration will occur.

Key levels

Resistance zones: 1.3600; 1.3850; 1.4000 ***; 1.4350 **.

Support zones: 1.3400 *; 1.3300 **; 1.3000 ***; 1.2840 / 1.2860 / 1.2885; 1.2770 **; 1.2620; 1.2500; 1.2350 **; 1.2250; 1.2150 **; 1.2000 *** (1.1957).

* Periodic level

** Range level

*** Psychological level