The BREXIT three to watch
Updated
BREXIT fever has hit the world of forex. I suggest these are the big three to watch: GBPUSD, EURUSD, and GBPEUR (or EURGBP). There is a macro-psychology operating out there I suspect. In times of trouble and uncertainty human nature tends to take the safe position. Hence Sterling has taken a step down for the moment because the reality is that 'everybody' wishes to safeguard their positions. However in recent days there is a growing realisation among some that Sterling simply won't just roll over and fall off the charts. If Britain does BREXIT, the uncertainty would be put to bed (at least for a while).
-The EURO has been in trouble for the last 5 years. Also, watch for the next shock wave expected to hit Deutschebank - over leveraged to the tune of 73 Trillion. (This does not mean that the EURO depends totally on Deutschebank)
-The European Union has been crumbling economically for quite a few years. Some know about it and some don't. The Union may not withstand a Brexit. The whole 'house of cards' may come tumbling down in the year or two following Brexit.
- If Britain Brexits, I suspect the pound will take off like a rocket in the week or two after.
- Turbulence in the forex markets will 'infect' the stock markets.
Britain is a resourceful nation - its people willing to sacrifice for a greater end. The Brits mean business. As I travel all over the UK all I see in every major city is extensive overhauling of buildings, construction of new structures, and roadways. Business is booming here. I think they've been preparing for Brexit for at least the last 5 years. Brexit - should it happen, will simply be the starter's shot
At the moment - if Brexit, my expectation (not prediction) is for GBPUSD to fall further but then rise again like the Phoenix. I expect EURUSD to fall in the next few weeks and continue south whatever happens. I therefore reason that GBPEUR or EURGBP are safer at this time or over next few weeks.
If no Brexit - sterling is still likely to rise, as uncertainty is relieved. Britain continues to grow regardless of the state of the Union.
This is not a time for fear. We live for volatility! But expected greater degrees of turbulence, means that our risk management processes need to be sharpened up. This is the real business. Sloppy traders will be shaken out. Disciplined traders will have a fun time! Best wishes to all.
[DISCLAIMER: This is not a trading tip (No liabilities accepted for anybody's losses). My expectations are based on events and knowledge at this point in time. I do not predict the future of markets in my trading methods. No one should rely on my expectations in their trading.]
-The EURO has been in trouble for the last 5 years. Also, watch for the next shock wave expected to hit Deutschebank - over leveraged to the tune of 73 Trillion. (This does not mean that the EURO depends totally on Deutschebank)
-The European Union has been crumbling economically for quite a few years. Some know about it and some don't. The Union may not withstand a Brexit. The whole 'house of cards' may come tumbling down in the year or two following Brexit.
- If Britain Brexits, I suspect the pound will take off like a rocket in the week or two after.
- Turbulence in the forex markets will 'infect' the stock markets.
Britain is a resourceful nation - its people willing to sacrifice for a greater end. The Brits mean business. As I travel all over the UK all I see in every major city is extensive overhauling of buildings, construction of new structures, and roadways. Business is booming here. I think they've been preparing for Brexit for at least the last 5 years. Brexit - should it happen, will simply be the starter's shot
At the moment - if Brexit, my expectation (not prediction) is for GBPUSD to fall further but then rise again like the Phoenix. I expect EURUSD to fall in the next few weeks and continue south whatever happens. I therefore reason that GBPEUR or EURGBP are safer at this time or over next few weeks.
If no Brexit - sterling is still likely to rise, as uncertainty is relieved. Britain continues to grow regardless of the state of the Union.
This is not a time for fear. We live for volatility! But expected greater degrees of turbulence, means that our risk management processes need to be sharpened up. This is the real business. Sloppy traders will be shaken out. Disciplined traders will have a fun time! Best wishes to all.
[DISCLAIMER: This is not a trading tip (No liabilities accepted for anybody's losses). My expectations are based on events and knowledge at this point in time. I do not predict the future of markets in my trading methods. No one should rely on my expectations in their trading.]
Note
As BREXIT referendum approaches, I can see:1. Increased volatility in GBP pairs.
2. GBP is showing initial signs of strengthening on most pairs (at 30 min level).
My favourites at the moment are GBPCAD and GBPEUR (where I'm long). Shorted EURUSD.
GBPNZD, GBPAUD seem to be tricky ones. I've stayed away, so far. GBPCHF looks interesting. But I remain vigilant for the right setups within my methods of trading.
tradingview.com/chart/dY34CAzG/
FED balance sheet 42% of GDP @ 2020-01-26. Does money have value anymore? [Different perspective on the virus youtu.be/NjTdvALChwk ]
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.