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Sterling managed to stage quite the comeback late last month as a Brexit agreement was ironed out.

Can it extend its gains post-breakup?

There’s not much in the way of top-tier data releases, but here’s what you should look out for:

BOE head Bailey’s speech (Jan. 6, 3:00 pm GMT)

  • Guv’nah Bailey is scheduled to give a testimony along with three MPC members, about the Financial Stability Report before the Treasury Select Committee
  • Expect questions related to Brexit, as well as the likelihood of more stimulus now that fresh lockdown measures have been imposed
  • Hints that the BOE could pursue further easing might force sterling to return its recent gains

Technical snapshot

  • Moving averages, particularly the 200 SMA and 50 SMA, reveal that EUR/GBP, GBP/AUD, and GBP/NZD are looking bearish
GBP Forex Pairs Moving Averages from MarketMilk
GBP Forex Pairs Moving Averages from MarketMilk
  • However, Stochastic shows that EUR/GBP is oversold while most of the other pound pairs are in the overbought region
GBP Forex Pairs Stochastic from MarketMilk
GBP Forex Pairs Stochastic from MarketMilk
  • GBP has been most volatile against the commodity currencies in the past week, moving an average of 76.4 pips against the Kiwi
GBP Forex Pairs Volatility from MarketMilk
GBP Forex Pairs Volatility from MarketMilk