24 July - exactly a year since Boris Johnson won the election of prime minister. During this time, much has changed in the world, in the UK. The only thing that hasn't changed is Johnson's desire to leave the European Union as quickly as possible and build a new, independent Britain.
Throughout the entire term of Boris Johnson's rule, we have repeatedly analyzed his actions, the decisions he made, and also looked forward to the victories of the current prime minister. Each analyst, expert and political scientist has his own point of view. We believe that Johnson's victories as prime minister can be counted on the fingers of one hand. On the one hand, Johnson did not become such a destructive figure for the world community and a violator of harmony as Donald Trump. Nevertheless, there are no significant victories in Johnson's career yet. Here anyone can immediately object to us. They say that Johnson still brought Brexit to the end, now the UK will still leave the European Union, an epic that could have lasted for years under other leaders ended quickly enough under Johnson. However, we fundamentally disagree with this interpretation and formulation of this problem. First, the decision to leave the EU was made by the British citizens themselves. Whether this referendum was fair or not, whether all residents voted or someone forgot to do it, it doesn't matter anymore. The people of Britain have expressed their desire to leave the EU. Thus, logically, it would have to happen anyway sooner or later. Secondly, from the very beginning, Brussels and London negotiated the most lenient divorce so that neither the EU economy nor the UK's economy would suffer. This was the main goal of the UK government, which was entrusted with the implementation of Brexit. You don't need to have a lot of intelligence just to sever all ties with the EU and start from scratch. Anyone could handle this, even a plumber from the nearest housing office. But to make sure that the British economy suffered minimally from the break with the EU, for this you need leadership qualities, the ability to negotiate, the ability to yield. Johnson did not demonstrate all these qualities during the year of his premiership. At first, just like Theresa May, he failed to agree with Parliament and did not find anything better than to simply dissolve it. The courts began, which Johnson lost, Parliament was reconvened, and thanks to the prime minister, a shadow fell on the Queen of England Elizabeth II, who, in fact, gave the go-ahead for the dissolution of Parliament. As a result, new battles began in Parliament, during which Johnson was unable to convince anyone of the need for a "hard" Brexit. Only Nigel Farage's Brexit party, created just a year before these events, supported Johnson. As a result, everything came to the parliamentary elections, which Jeremy Corbyn lost. In fact, it was Corbyn, who has long been accused of lacking a clear position on Brexit, who did not create real competition in the elections. The people of Britain did not vote for the Conservatives this time. They voted for the early completion of this "Marlezon ballet", which lasted for four years. Therefore, it cannot be said that the Conservatives defeated Labour and other parties thanks to Johnson's charisma and leadership, his position on Brexit. They won the election simply because the people of Great Britain were simply tired of living in constant limbo. Well, then, as soon as Johnson received full and unconditional power in the country, he immediately announced that the "transition period" would not be extended, and Brussels and London should agree on everything in nine months, or there would be no deal between them at all. And he gave the command to David Frost, who is negotiating with Michel Barnier, not to yield to Brussels on the most important issues. As a result, the negotiations, which could not end in anything worthwhile, even if the parties had been actively working on them for all nine months, hit a dead end literally in the very first month. And they are there to this day. Johnson's last loud statements concerned the fact that he himself would personally travel to Brussels and try to agree on everything with Ursula von der Leyen and other EU leaders. However, until now Johnson has not gone anywhere, and Barnier is already tired after each round of negotiations to declare that London does not make any concessions and is not eager to sign an agreement at all. As a result, Britain returned to Johnson's original plan - a complete severing of all ties and agreements and a hard Brexit.
And what is the result? There is no agreement with the EU. There is no agreement with America. Brexit will be as hard as possible. Trade will be conducted with the EU under WTO rules starting in 2021. Coronavirus has dealt another blow to the British economy, so that its losses will be the highest among the EU countries. But it is Johnson's government that is accused of being at least a month late with the quarantine and not taking COVID-19 seriously from the very beginning. Thus, now we can safely say that Johnson, of course, implemented Brexit, but, in fact, did not transform Britain in any way. Moreover, the British prime minister managed to spoil relations with Scotland, which now wants a second referendum on independence and return to the EU. And there is no doubt that Nicola Sturgeon will continue to push this desire in London. And there is no doubt that relations between Scotland and England will deteriorate, because the situation is quite logical: the majority of the Kingdom's inhabitants live in England; if the whole of England votes "for" leaving the EU, then the opinion of the Irish, Scots and Welsh will not even be needed; however, the residents of these countries did not decide to leave the EU, so the claims are quite justified.
Therefore, the future of the British pound remains very vague and uncertain. So are the prospects for the British economy. One is good for the pound. In recent months, there has been such chaos in the US that investors and traders have forgotten about all the British problems and switched to selling the US currency on all fronts. However, this cannot go on forever. At least, it seems that way at the moment.
Recommendations for the GBP/USD pair:
The pound/dollar pair continues its upward trend, so we recommend continuing to buy it using mainly the 4-hour timeframe. Volatility remains the same, about 100-130 pips per day, and is comfortable for trading. The nearest targets for buy orders are located around $1.28, then quotes can continue to grow up to 31 figures. Questions are raised only by the fundamental background, which the British pound supports today, but tomorrow it may stop doing this, since, as we have already said, there are a great many economic problems in Britain.
The material has been provided by InstaForex Company - www.instaforex.com