A technically driven move wipes out the pound on the first real trading day of 2025.

2024 has not been a great year for the pound, but it has largely kept pace with the US dollar due to the Bank of England’s hawkish stance against other developed market central banks.

But in the UK it’s not quite gangbusters for growth and we’re seeing some heavy movement today driven by the flow of the pound. Technicals are a big part of the equation with a break of the November-December low near 1.2475 leading to a stop and rush to the exit.

In the end, we’re down 100 pips from that level, partly due to broad USD strength, but also the case of a particularly weak pound.

2024 intraday low at 1.2299 and that is now a major support level.

After the US economic data, I think the most important numbers in the world to watch are outside the UK as we will see significant volatility in those numbers.