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Sterling (GBP) Continues to Crumble as EU/UK Brexit Talks Hit a Roadblock

Sterling (GBP) Continues to Crumble as EU/UK Brexit Talks Hit a Roadblock

Nick Cawley, Strategist

Brexit Outlook and Sterling (GBP/USD) Price, Analysis and Chart:

  • Brexit trade talks stumbling towards no-deal.
  • Sterling continues to collapse against a range of currencies.

EU/UK post-Brexit trade talks are not going well, according to the latest round of official and sources tweets with UK PM Boris Johnson set to pull out of negotiations sometime today unless the EU move on their demands. The talks are now described as being on a knife-edge with both sides said to be downbeat over the prospects of a deal.

GBP/USD has fallen by around 2 cents in early trade as traders begin to price-in a no-deal outcome. While the talks are ongoing, there is always a chance that a deal can be struck and that Sterling will rebound, but as we stand the market is starting to price-out a deal.

GBP/USD Daily Price Chart (March - December 7, 2020)

Sterling (GBP) Continues to Crumble as EU/UK Brexit Talks Hit a Roadblock

IG client sentiment data show 39.16% of traders are net-long with the ratio of traders short to long at 1.55 to 1.Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBP/USD price trend may soon reverse lower despite the fact traders remain net-short.

Traders of all levels and abilities will find something to help them make more informed decisions in the new and improved DailyFX Trading Education Centre

What is your view on Sterling – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1.

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