GBP/USD spiked higher for almost a cent today, because the US Unemployment Claims was better than expected?
What the hell does it have to do with UK, and boosts Pound to skyrocketly high?
Really, I don’t get it… There is nothing good for UK, yet their Pound goes up…
Thanks for your help!
Lulu2199
It was a result of news coming out of the euro summit that Ireland may be exiting the bailout program… That is good news for euro area
Don’t confuse things here.
These are traded in pairs. Sterling going up can either mean the pound strengthened, or the dollar weakened, or more likely a combo of both.
The dollar dropping on positive news means people moved out of cash, and into other venues. There are now more dollars on the market. If the pound doesn’t change in terms of it’s supply, the pound then advances against the dollar because of the change in the value of the dollar, not because the pound got stronger.
If it’s any consolation many analysts are as dumfounded as you.
Cable was rising, and eur/gbp falling - both against the trend - sterling strength, but why?
Some ideas:-
Qatar investing £10billion in UK (talk of)
Options expiries (talk of)
Scandnavian and asian buying stg (talk of)
Thats the problem with us retail - at 14.00 I could post the stg buying in progress - but I had no idea why, and probably will never know.
… Or it could be smart money profit taking on the gbp/usd. Now the question is whether this is a start of a reversal or just a retracement and gbp will continue its downtrend. We can only wait and see.
We will most likely see a range between 1.5250ish and 1.4950ish until the MPC meeting minutes are released next week and further insight is given about the prospects of increasing the asset purchase program… The possibility of that plus Carney coming in as the new BOE governor already mentioning willingness to ease further, will keep GBP from staging a true reversal without any confirmation that an increased asset purchase program is out of the question.
The last vote for increased asset purchase was 3-6 for it… If the upcoming meeting minutes show 4-5… Then look out below.
Well, I hope that this is a retracement. Honestly, it should be. Almost every major headline is about the slushy economy in UK atm. The numbers out this week were not really good, and it shouldn’t be different with the numbers next week.
Concerning Carney, he is a very dovish guy, and will probably allow more stimulus. Honestly, I believe that this is a retracement. People got their stop orders triggered, so naturally went out.
I gotta say that even though I know that there will be some serious pullbacks with such a parabolic decline, I don’t really know where will the retracement, and how much will it retrace.
A word about this investment talking of Qatar investing 10b: yes it’s a lot of money, yes UK is desperate for people coming investing in a time like this, but it’s really not something that should reverse any pair in such a desperate situation like this. UK is a big economy, and 10b will not be able to solve any of it’s problem.
Anyway, I believe that cable won’t move really much this week, and we have to wait for next week when some important numbers come out to see a clear direction.
Happy trading!
Wllen1
The truth is that nobody here could really know why it happened…
But the most likely reason is the inability to make another strong move downwards this week, so profit taking occured plus maybe some leveraged accounts searching for stops ahead of next week MPC meeting minutes
Today, ‘The Old Lady of Threadneedle Street’ mouthpiece Merv King said sterling was now “properly valued”.
Price does one of 3 things.
It goes down.
It goes sideways “fair value” (“properly valued”).
It goes up.
Sterling went down;
it is now "“properly valued” according to Merv King;
So, it had to go up.
What did the Hedge Funds do?
They waved their white flags as bears and they stuck their bids under Sterling.
Price went up. The only way left to go.
Get used to it, this is the most stresfull job on earth, you have stress every minute, not everybody can survive.
And there’s Mr. Sunshine…
Lol…Nice!!
Mr. Gone… you might want to consider find another job (j/k). Stress is not good for your health. You might wanna sign up and do some “yoga”… Keep smiling Mr. Gone 
There always will be contradictory data. Remember trading is a palm reading science, analisysy is just a tool that might give you some edge among the others, at the end it depends on luck. Quite simple, the data shows something but price do another different thing well, get out of that position, take a minor loss and try tomorrow. You have a good theory just stick onto it even when it does not work, just when that happens make sure to cut your loses short, fast and stay on red the less the posible. And the rare ocations it works make sure you stay on winners as long as posible.
And this bussines is full of idiots, don’t become one.
Sure why not.
So, in your opinion, what happened so that GBP rose so much?
Since yesterday I was expecting for that to happen, besides that it is up to you to decide.
… Can you be a bit more precise? Based on what did you think that it’s going to happen in future?
Lol you aren’t going to get anything precise out of him… He’s just going to tell you to expect the unexpected and that trading is painful pain
OK I get it. So basically, the worst scenario is that this rise of pound has zero reason. It is the god’s wish, and we must deal with this kind of situation sometimes, even it doesn’t make a single sense,is that right?
There is no sarcasm involved. I know that trading is tough, and things like that do happen from time to time.