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January 9, 2017

UK May opts for Hard version of Brexit, sends pound for a steep decline

UK May opts for Hard version of Brexit, sends pound for a steep decline

Finally Brexit case acquired new interesting details last Sunday. UK Prime Minister Theresa May said during interview that the access to EU’s single trade market could be a worth sacrifice to take complete control over trade, immigration, labor and many other UK policies. For UK it means yet another step away from EU bloc and is fraught with heightening political tension between Merkel and May. Brexit process essentially becomes unpredictable – as it really hard to imagine where political discussions and trade-offs will lead to. The Pound selloff is a natural result of this uncertainty, augmented with a pressure from currency speculators seeing Pound has lost its general support of 1.20 level:

screen-shot-2017-01-09-at-7-44-32-pm

Monday rebound from 1.2150 is likely to be short-lived as uncertainty will further drive the currency down until conditions over UK exit are clarified. Medium-term target is 1.15, while short-term is 1.20

Trading signal: SHORT GBP/USD, short-term – 1.2010, SL – 1.2250, Medium-term 1.15, SL – 1.2450

That’s it for now. We have also something special for you on US Dollar and Oil so stay tuned with Brokerarena.com!

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