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
GBP/USD
Mixed
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
  • Greed is a natural human emotion that affects individuals to varying degrees. Unfortunately, when viewed in the context of trading, greed has proven to be a hindrance more often than it has assisted traders. Learn how to control greed in trading here: https://t.co/kODPAfJE79 https://t.co/eReyYRYOn1
  • Last week’s march higher in EUR/USD may well extend further after Friday’s Eurozone economic statistics that will likely turn the ECB more hawkish on monetary policy. Get your weekly Euro forecast from @MartinSEssex here: https://t.co/EWrJy5LfOF https://t.co/NQj5xCdw9b
  • The Consumer Price Index, better known by the acronym CPI, is an important economic indicator released on a regular basis by major economies to give a timely glimpse into current growth and inflation levels. Learn how to better understand CPI here: https://t.co/nAa0fHHGbZ https://t.co/uDeIMr1Ks4
  • A currency carry trade involves borrowing a low-yielding currency in order to buy a higher yielding currency in an attempt to profit from the interest rate differential. Find out if the carry trade suits your trading style here: https://t.co/7t4BzmLg8w https://t.co/srqRhfdKUd
  • Cable is pulling off after a strong run; near-term weakness may be the theme before trying to rally again. Get your weekly GBP technical forecast from @PaulRobinsonFX here: https://t.co/030gXzxlEc https://t.co/ux7W6OcBOm
  • Japanese candlesticks are a popular charting technique used by many traders, and the shooting star candle is no exception. Learn about the shooting star candlestick and how to trade it here: https://t.co/mfwJ0sZLTs https://t.co/FPKAoLQuuI
  • Do you know how to properly Identify a double top formation? Double tops can enhance technical analysis when trading both forex or stocks, making the pattern highly versatile in nature. Learn more about the double top formation here: https://t.co/t9Flsqcxo9 https://t.co/2L5DGk7cxl
  • Dealing with the fear of missing out – or FOMO – is a highly valuable skill for traders. Not only can FOMO have a negative emotional impact, it can cloud judgment and overshadow logic. Learn how you can control FOMO in your trading here: https://t.co/lgDf5cVYOn https://t.co/zRBB1hmhJm
  • USD/CAD has bounced off a key support area on Friday and could potentially charge higher in the coming week as risk-aversion over coronavirus fears has started to dominate market moves. Get your weekly CAD technical forecast from @DColmanFX here: https://t.co/bySyBXTAdr https://t.co/y6UqD0quGN
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here: https://t.co/ADSC4sIHrP https://t.co/sPcCTQfaRd
Sharp GBP/USD Reversal as May's Brexit Approach Softens

Sharp GBP/USD Reversal as May's Brexit Approach Softens

Christopher Vecchio, CFA, Senior Strategist

Talking Points:

- UK PM May signals parliamentary inclusion in process of triggering Article 50, upping odds of a 'soft Brexit.'

- DXY Index sinks towards 100.50 as GBP/USD rallies above 1.2250.

- See the DailyFX Economic Calendar for today's data and read our weekly outlook on key event risk.

Webinar Schedule for Week of January 15 to 20, 2017

Monday, 7:30 EDT/12:30 GMT: FX Week Ahead: Strategy for Major Event Risk

Wednesday, 7:30 EDT/12:30 GMT: Central Bank Weekly

Wednesday, 8:15 EDT/13:15 GMT: Live Event Coverage: US Consumer Price Index

Thursday, 7:30 EDT/12:30 GMT: Live Event Coverage: European Central Bank Rate Decision

The British Pound is rallying sharply this morning as UK Prime Minister Theresa May has formally announced that the government will seek parliamentary approval to trigger Article 50, the legal mechanism by which the UK could leave the EU. Whereas UK PM May is not saying anything different than she did just last week when she said, "We are leaving...We are coming out," the context in which it is occuring is now completely different. Brexit now appears 'soft' instead of 'hard.'

Chart 1: GBP/USD 1-minute Timeframe (January 17, 2017)

Sharp GBP/USD Reversal as May's Brexit Approach Softens

The decision to include parliament in the Brexit process is an important one. As we've maintained since the Brexit vote itself, as a non-binding resolution, it would require Parliamentary ratification. Why did the UK PM include parliament now? It seems that the UK Supreme Court is set to rule against the government's Brexit appeal.

How do today's comments from UK PM May differ from those last week, then? It's important to recall that the vast majority of MPs were in favor of 'Remain' - about 75%. Seeing as how it would be political suicide not to respect the democratic will of the people, parliament seems poised to approve the triggering of article 50 if a deal is presented that they like. Implicitly, this means that Brexit will be as soft as possible, if it happens at all.

As we wrote last week, "Parliamentary inclusion could result in market participants stepping away from the 'hard Brexit' narrative. Thus, while GBP weakness is picking up in the near-term, by no means do we feel that this is the start of the next significant leg lower yet; there is too much event risk ahead that could turn the tide sharply." Now that this is playing out, expect two-way volatility to pick up in GBP-crosses across the board in the near-term.

See the above video for a technical review of the DXY Index, EUR/USD, GBP/USD, AUD/USD, USD/JPY, GBP/JPY, and Gold.

Read more: FX Markets Look to CPI from UK & US, BOC & ECB, Chinese GDP

--- Written by Christopher Vecchio, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher's e-mail distribution list, please fill out this form

View our long-term forecasts with the DailyFX Trading Guides.

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

DISCLOSURES