Where to trade the GBP?
Lat weeks short GBPUSD closed for zero, the set up no longer seems clear cut but our bearish view of the pound remains undiminished. The surprise index on the economic blog keeps us looking lower for the GBP but finding a place to trade it is becoming difficult. GBPCHF might offer a great opportunity.
GBPCHF technical analysis
The weekly chart above shows the pair stuck in a multi decade bear trend the last leg of which seems incomplete, a small triangel has appeared that looks very bearish and should it break could have price moving to the bottom of the range formed in 1973. If the last 5 years of sideways continues then the downward trend may come under threat. The daily chart offers some evidence that a short maybe at hand
What could be bearish flag pattern (the orange channel) appears to have broken down and been retested allowing a new blue downward trendline to develop. That blue line was retested on Friday and appears to be holding, the wave projection suggests that the current move lower could reach 1.15, from current levels that would offer an 8:1 risk reward.
As always with the GBP, political concerns are the issue. Mrs May will present her Brexit plan again, it will be the same old same old and it wont get through, It is becoming binary now either Mrs May keeps controla nd the UK leaves without a deal or Parliment gets control and the chance of a hard brexit drops to zero. Whichever way ot goes expect some significant moves, two risky for us to trade at the moment but when the situation clears we will be looking to seel the Pound
RetiredearlyFX is a trading name of the investment company Bagehotsway.
We are not a regulated company but we only sell regulated products.
We are not authorised to give investment advice.
We believe all figures quoted to be accurate but past performance in no way guarantees future performance
Trading FX is high risk and not suitable for everyone.