All the sanctions imposed by the West have so far been exclusively restrictive. That is, they were limited to a ban on doing business and freezing funds on accounts. But already the suspension of operations with the gold and foreign exchange reserves of the Bank of Russia has somewhat strained investors, since this decision has come very close to direct withdrawal of funds. And last night, Europe did what international investors fear most in the world - the confiscation of property.
Hamburg authorities seized Alisher Usmanov's yacht on the grounds that he is under sanctions. There are a huge number of rich people in the world who acquire not only property in Europe, but also all kinds of assets. In fact, the richest people in the world keep part of their capital in Western Europe. These capitals are one of the components of the economic well-being of the European Union. Now all these people have seen that Europe can take and take away their capital on the sole grounds that it does not like their behavior.
So now a gradual outflow of capital from Europe will inevitably begin. From this, by the way, the pound has already won, which unexpectedly showed good growth Wednesday. And we are talking about colossal amounts, estimated in hundreds and hundreds of billions of euros.
Of course, the war in Ukraine itself contributes to the outflow of capital, but relatively moderate and rather even temporary. The process will not be instantaneous. It will last for years. So it can still be stopped. But Europe makes such decisions that just contribute only to its acceleration. And the long-term prospects of not only the single European currency, but also the economy of the entire European Union are painted in dark tones. And as already noted a little above, the pound was the first to benefit from such actions, since London becomes the first stop on the way of capital away from the European Union, where property is seized out of lawlessness.
The EURUSD currency pair during the rapid downward movement reached 1.1057, where there was a reduction in the volume of short positions and price stagnation. In this situation, the downward trend is still taking place in the market, where the current stagnation may well play the role of leverage in subsequent price surges.
The GBPUSD currency pair rebounded from the local low of the past week with surgical precision. This led to an almost complete recovery of the pound sterling relative to the recent decline. Now traders are considering the area of 1.3435 as resistance, where there has already been a reduction in the volume of long positions. If the slowdown is confirmed, short positions may resume growth over time.