We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Mixed
GBP/USD
Bearish
USD/JPY
Bearish
Gold
Bullish
Oil - US Crude
Bearish
Bitcoin
Bearish
More View more
Real Time News
  • The Australian Dollar and New Zealand Dollar tend to rise with stocks. They have recently fallen despite gains in the #SP500. What does this mean for $AUDUSD and $NZDUSD ahead? #AUD #NZD #RBA #RBNZ - https://www.dailyfx.com/forex/fundamental/article/special_report/2020/01/17/AUDUSD-NZDUSD-Outlook-Looks-Past-Stocks-to-Rate-Cut-Bets.html?CHID=9&QPID=917702 https://t.co/ddf2fV7Kyl
  • A few snippets from today's commentary. Check out the link below for the full story (via @DailyFX). https://t.co/I31tuq764r https://t.co/x0BaiOFA1P
  • Have you joined @DailyFX @facebook group yet? Discuss your #forex strategies and brush up on your skills with us here: https://t.co/jtY1G7g8yx https://t.co/e2YrN3dBrl
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 98.00%, while traders in France 40 are at opposite extremes with 79.59%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/UL7hqSD2Ki
  • US Dollar Forecast: $USD Lacking Impetus Ahead of Consumer Sentiment #Forex traders shift focus away from US-China trade deal headlines - perhaps toward the monthly release of #ConsumerSentiment data for volatility and clues on the Greenback's next move https://www.dailyfx.com/forex/fundamental/us_dollar_index/usd_trading_today/2020/01/16/us-dollar-forecast-usd-lacking-impetus-ahead-of-consumer-sentiment.html
  • Forex Update: As of 05:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.11% 🇦🇺AUD: -0.02% 🇯🇵JPY: -0.03% 🇨🇭CHF: -0.05% 🇬🇧GBP: -0.06% 🇨🇦CAD: -0.07% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/Kxcb9EtIWb
  • Indices Update: As of 05:00, these are your best and worst performers based on the London trading schedule: Germany 30: 0.45% France 40: 0.26% Wall Street: 0.07% US 500: 0.00% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/I5YIsKQAog
  • 🇯🇵 JPY Tertiary Industry Index (MoM) (NOV), Actual: 1.3% Expected: 1.0% Previous: -5.2% https://www.dailyfx.com/economic-calendar#2020-01-17
  • The $JPY has weakened as a bounce-back in risk appetite saps haven-asset demand. However, the old uptrend line still provides clear resistance. Get your market update from @DavidCottleFX HERE:https://t.co/IMhgQ9jbF9 https://t.co/I7087olftk
  • Heads Up:🇯🇵 JPY Tertiary Industry Index (MoM) (NOV) due at 04:30 GMT (15min), Actual: N/A Expected: 1.0% Previous: -4.6% https://www.dailyfx.com/economic-calendar#2020-01-17
British Pound Lacks Fundamental and Technical Conviction

British Pound Lacks Fundamental and Technical Conviction

2010-03-11 15:30:00
John Kicklighter, Chief Currency Strategist
Share:

The British pound is struggling to find consistent direction. Looking at the fundamental backdrop, the aggressive move to unwind risky positions has let up and subsequently taken the pressure off the United Kingdom's combined troubles of a burgeoning deficit, slow economic recovery and impending government election. At the same time, this pullback in fear hasn't immediately translated into a rebound in risk taking - a move that would likely benifit the currency as risk premium is worked off. Nonetheless, the fundamental health of the sterling through growth, yield potential, fiscal and financial stability is not improving. In fact, uncertainty is actually growing. This is building pressure, whereby this fundamental activity will eventually act out when sentiment forces the issue (just like the plunge through the final two weeks of February).

This leaves me with a high level of uncertainty for this currency and something of a bearish bias. Yet, for most pairs, there is limited opportunity from the technical position for a possible revival of trend that falls back into the fundamental groove. Furthermore, after the aggressive selloff over the recent past; I don't think I would want to try to eek out limited follow through (just look at the wide ranges on all the pound crosses over the past year - we aren't far from pound support for this period). The only pair I have interest in is actually one that counters my bearish bias on the sterling. I went short EURGBP at 0.9125 where the pair is looking to confirm a descend trend of highs from 12/30/2008 to 10/13/2009 to price action over the past few weeks. Fundamentally, I am even less confident in the euro as the market is not fully discounting the deeply rooted financial problems the Euro Zone is facing (not to mention the restrained growth and distant hope for rate hikes that come along with it). I have set my initial stop at 0.9150 and a first target at 0.9010. A second objective of 0.8880 makes for a significant retracement into the middle of the wedge pattern.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.