GBP/USD drops despite the dollar weakness. What is happening?

The GBP/USD pair dropped for the third day in a row despite the greenback weakness and stood near 1.3870. The fall resulted from the anxiety about the coronavirus vaccine in the European Union and the EU and UK fight over the Northern Ireland protocol.

France becomes 15th country to suspend AstraZeneca vaccines

The drama over British-Swedish pharmaceutical company, AstraZeneca vaccines between Europe and Britain spills outside boundaries. 

More than a dozen countries have suspended using the AstraZeneca covid-19 vaccine as a precautionary measure, following notification of “possible” side effects.

According to the Anglo-Swedish pharmaceutical group, there is no evidence of an increased risk of a blood clot caused by its vaccine. Meanwhile, the World Health Organization believes that there is no reason not to use this vaccine. 

The countries that suspended the vaccination with AstraZeneca are Denmark, Iceland, Norway, Bulgaria, Ireland, Netherlands, Germany, France, Italy, Spain, Portugal.

EUR/GBP refreshed one-week top on confirming bullish chart pattern

EUR/GBP entered the 0.8600 thresholds. The pair is currently up 0.25% intraday, overcoming the multi-month low marked earlier in the month.

However, the EUR/GBP bulls will find multiple upside limits around the mid-0.8600s during the extended increase.

Meanwhile, sellers are likely to avoid entering unless observing a clear downside break below 0.8595, comprising an eight-day-long flat area. Also, the 200-HMA level of 0.8586 is acting as a downside filter.

If EUR/GBP drops below 0.8586, chances are it falls to the lowest since February 2020, about 0.8540.

EUR/USD now faces extra range bound

UOB Group’s Forex Strategists believe EUR/USD to trade within the 1.1840-1.2030 range in the following weeks.

In the last seven days, the US dollar marked a decrease of 0.11%. For a year, it has accumulated a decline of 8.02%. 

Last year, the US dollar reached a maximum of $0.84 against the EUR, while its lowest level has been $0.81.