Sterling exchange rates crumble further as Brexit concerns still hang over the head of the Pound (Daniel Wright)
April 9, 2016 AUD, CAD, CHF, Economic data, Euro, NZD, Predictions, Sterling strength, Sterling weakness, USD
The Pound has taken yet another bashing in trading over the last 24 hours and my confidence in a recovery is starting to be seriously tested.
We even saw industrial and manufacturing data coming out as negative on Friday morning and in my view should we start to see a big push back up in the direction we need a catalyst and so far that just has not arrived.
The next big data we have out for the U.K is a flurry of inflation data due out on Tuesday morning. Further negative news may lead to yet another tumble but a positive release could finally give those that are looking to buy foreign currency the lift they are waiting for.
The issue for the Pound at present is uncertainty, both in a political and economic sense. The referendum is not only causing investors and speculators to leave the Pound alone as they do not know what our economy will be facing shortly, but it is also causing our politicians to fight between themselves and this is also bad news for a currency.
All in all I still believe that against the grain there is room for the Pound to improve in the coming weeks, however the catalyst does need to arrive and fast.
If you have the need to buy or indeed sell Sterling for your business, due to a property purchase/sale or for any other reason then it is important to have a proactive broker on your side and one that can get you the very top levels of exchange – It is very easy to settle for second best in this market but it is key to realise that even the slightest improvement in a rate of exchange can save you a huge sum of money.
Unusual to see GBP/AUD jump up these days when risk is on but those large GBP/JPY order flow movements this morning seem to have disrupted things a bit. Let’s see if normal service resumes…
Closed for +50. Between that and the long DAX from earlier this morning off to a decent start this week. Hopefully don’t p*ss it away now doing something stupid later.
Im a tad annoyed with myself.
One of the cornerstones of my strategy is not to open a trade while an existing trade is in a losing position, yet this month ive continually broken this rule.
Time to step back, give myself a slap, and get back to good habits
Okay, first new trade of the week.
Short GbpUsd 1.4244.
This is one of the longer trends running currently, been falling steadily for a year now. With no sign of a BoE rate hike in sight and the current turmoil over Brexit, I think this will continue downwards until at least the vote in June, if not longer
Right, back in course with 2 trades, both in profit, both with stops just inside BE to give them wiggle room without risking a loss.
Nice and steady, Steady Eddie
Hi Adrian, dont seem to see you on BP as regularly as before. Wondering if/when you finally closed this trade, it reached 2.50 at one point so kudos if you got out on or near the top.
Namaste
Anyhow, a bit of an update of what Im currently trading.
LONG UsdJpy @ 109.35 Recent comments from Japan suggest enough is enough as far as a strong Yen is concerned, so I feel this has limited downside
LONG GbpNzd @ 2.0510 The ‘experts’ dont seem to know where this pair are going. The UK economy is about as stable as they get, sure there is not great growth but there is not a lot of risk. Whatever the Brexit result we will get violent swings in the days preceding the vote but I believe things will return to 2.05 to 2.10 pretty soon. Im happy to close this at 2.07 before the vote just to be safe.
SHORT EurUsd @ 1.1388 This pair has struggled to stay over 2.14 for any prolonged period and at some point the dollar has to kick on, probably as we get nearer to the election.
EXPECT MORE STIMULUS, BUT NOT RATE CUTS, FROM BOJ – MARKET TALK
15 April 2016, 19:59
12:59 ET - Negative interest rates have proven an unpopular policy for global central banks, and UBS thinks it’s unlikely the Bank of Japan will cut rates further below zero at its April 28 monetary-policy meeting. But it does see the BOJ expanding its bond-buying program by 25% to Y100T/year. UBS thinks that, together with an expected boost in stimulus from the finance ministry in July, will take the dollar back up to the investment bank’s price target of Y117 in the next 3 months. It’s down 0.6% today at Y108.69. ([email protected])
It was more a human interest post than a trading post. Its not always about the money
Looking back at the charts, very little happened but this did occur on a Friday evening after the Asian, European, and UK markets had closed and just before the US was closing so there was very little trading.
