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
EUR/USD
Bearish
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
Oil - US Crude
Bullish
Wall Street
Bearish
Gold
Bearish
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
GBP/USD
Bearish
USD/JPY
Mixed
More View more
Real Time News
  • Many people are attracted to forex trading due to the amount of leverage that brokers provide. Leverage allows traders to gain more exposure in financial markets than what they are required to pay for. Learn about FX leverage here: https://t.co/BdgFmkRxVw https://t.co/FqAsp91Gia
  • 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/cKOUmtj7Dj
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/Yl9vM7kO6a https://t.co/TnL91f7sl7
  • Human error in the forex market is common and often leads to familiar trading mistakes. These trading mistakes crop up particularly with novice traders on a regular basis. Learn about the top ten trading mistakes and how you can avoid them here: https://t.co/i8E2AXtzF3 https://t.co/cDcjl3Ue09
  • Consolidation or bull flag? A bull flag is a continuation pattern that occurs as a brief pause in the trend following a strong price move higher. Learn how to better spot these formations here: https://t.co/yOEvLjKnct https://t.co/KWOX5wSipe
  • What is your forex trading style? Take the quiz and find out: https://t.co/YY3ePTpzSI https://t.co/cwSWCpKtaj
  • 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/zu5hMovbz6
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZFxlk https://t.co/QMKyTBOKNG
  • Currency exchange rates are impacted by several factors. Are different world leaders a contributing factor? Find out here: https://t.co/4jsORznRTE https://t.co/aRkGoNvj6D
  • 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/ltVTNO2sjT
GBP/USD Volatility Rises as BOE Policymakers Speak on UK Post-Brexit Vote

GBP/USD Volatility Rises as BOE Policymakers Speak on UK Post-Brexit Vote

Christopher Vecchio, CFA, Senior Strategist

Talking Points:

- BOE says that UK economy outperforming forecasters’ pessimistic expectations.

- BOE policymakers warn that more easing might be necessary in future.

- Balanced commentary leads to whippy price action in GBP/USD.

A slew of Bank of England policymakers were on the wires this morning, shedding light on their views of the UK economy in the post-Brexit vote world. News headlines over the past few weeks have been nothing but cheerful, if not smug, about the state of the UK since the June 24 vote. BOE Governor Carney, alongside policymakers Cunliffe, Forbes, and Vlieghe, all weighed in.

With respect to the unexpected outperformance in the UK data recently, it seems the BOE is more than happy to take some credit. After all, the UK money supply is expanding at an incredibly fast pace right rate now (as measured by the three-month annualized rate of growth in M4ex), +14.7% y/y in July). All four BOE policymakers made clear that the central bank is able and willing to do more to stimulate the economy if necessary before the end of the year.

Admittedly, as all of the BOE policymakers conceded, data has turned out better than expected. The rebound in the PMIs in August was anticipated, as the BOE noted, as the sobering fact remains that Brexit hasn’t happened yet. The new UK Prime Minister, Theresa May, has yet to trigger Article 50, which would begin the process of negotiating the UK’s new standing in Europe with the EU. Until then, everything else is just noise: swings in short-term sentiment that will ultimately have no bearing whatsoever on how the UK is performing once the framework of the EU ex-UK economy is finalized.

See the DailyFX economic calendar for Wednesday, September 7, 2016

Chart 1: GBP/USD 1-minute Chart (September 7, 2016 Intraday)

GBP/USD Volatility Rises as BOE Policymakers Speak on UK Post-Brexit Vote

Around the positive (‘the UK economy is doing better than we envisioned’) and negative (‘we may still need to ease policy further this year’) commentary, the British Pound was quite whippy this morning, testing both sides of its morning range versus the US Dollar. GBP/USD started the policymaker press conference around $1.3372, a tick below where it was at the time this report was written. Between then and now, GBP/USD traded between $1.3350 and $1.3397, levels in which it has traded since approximately 04:30 EDT/9:30 GMT today. With FX volatility edging higher again, it’s the right time to review risk management principles to protect your capital.

Read more: US Dollar Dogged by Sinking Fed Hike Expectations

--- Written by Christopher Vecchio, 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

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

DISCLOSURES