News & Analysis at your fingertips.

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. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • The US Dollar outlook against ASEAN currencies like the Singapore Dollar, Thai Baht, Indonesian Rupiah and Philippine Peso remains bullish amid capital outflows risks as Covid cases swell. Get your market update from @ddubrovskyFX here:https://t.co/vRUVxvQP8o https://t.co/cUEkW9BfIP
  • Is investing in your favorite brand or buying its products the better financial move? Read the article for a breakdown. https://t.co/iWOlDAK8cD https://t.co/0uS5VvWj12
  • Crude oil prices collapsed on Monday despite an OPEC+ breakthrough, driven by Covid-induced demand woes. Meanwhile, Gold is at odds with a stronger US Dollar and falling Treasury yields. Get your #crudeoil market update from @FxWestwater here:https://t.co/H1vmag8d1k https://t.co/PW5pCw9dKR
  • The Japanese Yen has been making a comeback, but it may soon resume its decline against the US Dollar as USD/JPY consolidates within a bullish Falling Wedge. Watch for a breakout. Get your market update from @ddubrovskyFX here:https://t.co/zxRWoNR4lS https://t.co/bXTx0TSRmU
  • BTC/USD treading water sideways, 28600 the big level to watch. ETH/USD working on forming a nice-looking descending wedge. Get your market update from @PaulRobinsonFX here:https://t.co/H1qOV4FR1P https://t.co/tjutUl7Nt7
  • Gold hasn’t been very active the past few sessions, but that could change next week and provide a stronger trading bias. Get your weekly gold technical forecast from @PaulRobinsonFX here: https://t.co/HaEe3i4Sug https://t.co/LsARS2mnFI
  • Market uncertainty sees GBP pairs break out of their ranges. Get your weekly GBP forecast from @HathornSabin here: https://t.co/IRO7a6Jv8J https://t.co/4LxWz7sOVF
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.01% 🇪🇺EUR: 0.01% 🇨🇦CAD: -0.03% 🇬🇧GBP: -0.16% 🇦🇺AUD: -0.21% 🇯🇵JPY: -0.36% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/AXKeEsin95
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: -0.02% Gold: -0.27% Silver: -0.91% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/PgsZBsHHp8
  • The Canadian Dollar is poised to snap a three week losing streak against the US Dollar after USD/CAD reversed sharply off technical resistance early in the week. Get your $CAD market update from @MBForex here:https://t.co/JhO6n3Di9h https://t.co/17N1aFRUDB
GBP Bears Beware: Boris as UK Prime Minister Might be Good for Sterling

GBP Bears Beware: Boris as UK Prime Minister Might be Good for Sterling

Martin Essex, MSTA, Analyst

GBP price, Boris Johnson and Brexit:

  • Former UK Foreign Secretary Boris Johnson is in pole position to take over from Theresa May as the next British Prime Minister.
  • However, traders looking to sell Sterling on the grounds that the risk of a no-deal Brexit would then rise need to be aware that his commitment to leaving on WTO rules could change.

Boris, Brexit and the British Pound

Former British Foreign Secretary Boris Johnson has become the clear favorite to replace Theresa May as UK Prime Minister if, as expected, she resigns in the coming days. For many traders, that would be a strong signal to sell the British Pound as he is widely seen as a hard-line Brexiteer who would take the UK out of the EU without a deal.

Leaving without an agreement, and reverting to World Trade Organization (WTO) rules, is seen widely as negative for Sterling. However, Johnson – known countrywide simply as Boris – has changed his mind on Brexit before and might not be as committed to no-deal as he is sometimes seen.

As the Conservative-leaning magazine The Spectator asked: “Would he govern as a reckless populist, delighting the Tory membership by driving Britain out of the EU without a deal? Or would he carry out a Nixon to China reverse-ferret, pivoting to a softer Brexit position by way of a second referendum or even revoking Article 50 and starting again?

Indeed, Johnson himself has written: We who are part of this narrow majority [in favour of Brexit] must do everything we can to reassure the Remainers. We must reach out, we must heal, we must build bridges – because it is clear that some have feelings of dismay, and of loss, and confusion.”

What Johnson might mean for GBP

His commitment to a no-deal Brexit is therefore not as strong as sometimes portrayed and another “reverse-ferret” – British newspaper slang for reversing your position – cannot be ruled out, meaning there is no guarantee that if he becomes Prime Minister the Pound would extend its recent sharp decline.

GBPUSD Price Chart, Daily Timeframe (December 27, 2018 – May 22, 2019)

Latest GBPUSD price chart.

Chart by IG (You can click on it for a larger image)

For sure, there are plenty of reasons why GBP could weaken further, as I pointed out here. However, my recent Twitter poll on which possible successor to May would be best for Sterling put Johnson in second position, just behind the Opposition Labour Party’s Jeremy Corbyn. To reiterate, selling GBP on a possible Johnson premiership is risky.

Who could become UK Prime Minister?

Turning to the other runners and riders, the chart below shows that Johnson is not just ahead of the field but increased his lead sharply in May.

Odds on next UK prime minister.

Source: Michael McDonough, Bloomberg, on Twitter

According to the Oddscheker website at the time of writing, many betting companies are now quoting Johnson at 2/1 to take over from May. Here are the approximate odds on her other likely Conservative successors:

  • Dominic Raab, 5/1, is a former Brexit Secretary, now no longer in Government, and a Brexiteer. Verdict: negative for GBP.
  • Michael Gove, 10/1, is Environment Secretary and a long-time supporter of a hard Brexit. Verdict: negative for GBP.
  • Jeremy Hunt, 10/1, is Foreign Secretary and campaigned to remain in the EU before changing his mind. Verdict: mildly positive for GBP.
  • Penny Mordaunt, 20/1, is Defense Secretary and campaigned to leave the EU. Verdict: negative for GBP.
  • Matthew Hancock, 20/1, is Health Secretary and a potential centrist candidate. Verdict: neutral for GBP.
  • Sajid Javid, 20/1, is Home Secretary and voted reluctantly to remain in the EU. Verdict: mildly positive for GBP.

Further down the field, two other potential candidates have launched campaign groups: former Work and Pensions Secretary Esther McVey has unveiled a hardline Brexit group Blue Collar Conservatism (GBP negative) while her successor Amber Rudd has launched a centrist Remain group called One Nation (GBP positive).

More to read:

British Pound: What every trader needs to know

Using News and Events to Trade Forex

Resources to help you trade the forex markets:

Whether you are a new or an experienced trader, at DailyFX we have many resources to help you:

--- Written by Martin Essex, Analyst and Editor

Feel free to contact me via the comments section below, via email at martin.essex@ig.com or on Twitter @MartinSEssex

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

DISCLOSURES