Here’s how we decipher it
There’s some confusion about why the pound is moving down on all this Brexit news when it’s the remainers (or soft Brexit crew) kicking up a stink this time.
- Leavers = hard exit = GBP negative
- Remainers = soft Brexit = GBP positive
- May facing a revolt/confidence vote from either side = huge political uncertainty = GBP negative
So, even today, when it’s the remainers who are pushing their agenda, which should be seen as a soft exit and therefore GBP positive, the possible revolt against May is trumping that (GBP negative)
Long and short, if May wins the vote tonight, we’ve got a potentially harder Brexit on the cards but then more possible resignations and/or a confidence vote. So on paper it’s two negatives. If she wins without any fuss then the political uncertainty is removed which should be GBP positive but that still leaves us with a more hard Brexit slant, which is GBP negative.
I hope that’s cleared that up ?
Trade the pound through all this? I wouldn’t trade it with your money ?
Philosophy: “Don’t be a Dick for a tick”
Read how Ryan got into trading here
- The last NFP competition of 2022 - December 1, 2022
- Will this month’s US NFP be a horror show? - October 4, 2022
- US NFP competition – Do you think there’s going to be a turn in the US jobs market? - August 31, 2022
Hi Ryan, nice to read you again. It feels like no Brexit summer holidays this year again…
Hi CP.
How are you my friend? I hope markets have been treating you kindly?
Brexit is all slowly coming to a head isn’t it? You might remember right at the start I said the thing that would screw it all up would be political infighting and here we are. I’d rather be dreadfully wrong on that remark though 😉
Life goes on though and there will be a Britain after Brexit and if it’s no good, we can all move to France, Spain, Germany etc etc 😀
All good here down under. Not trading much, but very active on the investment side (lending). More focused on GBP now, as I think I will be buying the bullet and re-allocate into AUD. There is downside here as well, but the the political situation in the UK just looks too unstable. They can’t seriously be at a negotiation table without having a strong political backing. Very messy, and yes, it was fairly predictable, even though there were glimpses of hope from time to time.
“it was fairly predictable, even though there were glimpses of hope from time to time.”
Those were Mike’s shorting opportunities 😀
It’s true about not having a strong hand but then when you’re up against the Junckers etc, you’ve got to fancy your chances 😉
If I was May I’d take the bull by the horns and cut out all those wasters and take the negotiations straight to the leader level and get it done that way.