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.

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
EUR/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
Oil - US Crude
Mixed
Wall Street
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
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • The #DowJones and #SP500 have as of today averaged: -2.16% & 1.43% 3-months and 1-year before #Election2020 respectively What could this mean for the incumbent president/Trump next week? 👇 https://t.co/e4EyLTzRXl
  • Forex Update: As of 20:00, these are your best and worst performers based on the London trading schedule: 🇬🇧GBP: 0.14% 🇨🇦CAD: 0.04% 🇦🇺AUD: 0.01% 🇨🇭CHF: -0.18% 🇳🇿NZD: -0.22% 🇪🇺EUR: -0.23% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/XuMcr136y1
  • Commodities Update: As of 20:00, these are your best and worst performers based on the London trading schedule: Silver: 1.86% Gold: 0.58% Oil - US Crude: 0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/hojorwKSRk
  • USD/ZAR: New support may be established at the 16.1000 zone as the price pushed off this level after uncertainty around US stimulus negotiations. Get your $USDZAR market update from @WVenketas here:https://t.co/AQaNSMuZce https://t.co/Fg8uMAYtiU
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.39%, while traders in NZD/USD are at opposite extremes with 62.91%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/PzjdeSuKfy
  • France records 545 Covid deaths, most since April 20 - BBG
  • US Equity Update (Friday Close): $DJI -0.58% $SPX -1.21% $NDX -2.62% $RUT -1.48% $VIX +0.48%
  • Indices Update: As of 20:00, these are your best and worst performers based on the London trading schedule: France 40: 0.17% Germany 30: 0.10% Wall Street: 0.06% US 500: 0.03% FTSE 100: -0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/73hNnCZ3p7
  • Update on #Cryptocurrencies #BITCOIN +0.22% #BITCOINCASH -3.14% #ETHEREUM -1.54% #RIPPLE -2.62% #LITECOIN -2.14%
  • In the past three elections, the lead up to the event (dashed vertical line is election dates) has seen pullback from the $SPX. Aligns to actions surrounding uncertainty https://t.co/9J2RKa9FEe
GBPUSD Currency Volatility: Brexit Latest Rattles Sterling

GBPUSD Currency Volatility: Brexit Latest Rattles Sterling

2019-05-21 21:30:00
Rich Dvorak, Analyst
Share:

GBPUSD & BREXIT – TALKING POINTS

  • Spot GBPUSD went on a rollercoaster ride during Tuesday’s trading session as ongoing Brexit drama intensifies
  • Upcoming UK economic data and EU Parliamentary elections threatens further turbulence in the British Pound
  • Download the free Q2 GBP Forecast via DailyFX for in-depth British Pound outlook

GBPUSD whipsawed on Tuesday in a volatile session with the cable ranging between an intraday high and low of 1.2814 and 1.2685 – a range of 129 pips. British Pound price action quickly followed the latest Brexit developments out of the UK as Prime Minister Theresa May announced that the government will offer up a second referendum hoping to avoid a no-deal departure from the EU.

CURRENCY VOLATILITY AND TRADING RANGES (IMPLIED)

Forex Market Implied Volatility and Trading Ranges GBPUSDCurrency volatility for major USD currency pairs

Spot GBPUSD initially soared on the news, but the sterling subsequently swooned as corralling enough support from British MPs – and avoiding a no-deal Brexit – remains an uphill battle.

Following the second Brexit extension provided to the UK last month, GBPUSD implied volatility took a nosedive.However, GBPUSD price action looks to creep higher with Brexit uncertainty beginning to build once again.

GBPUSD IMPLIED VOLATILITY: DAILY TIME FRAME (OCTOBER 01, 2018 TO MAY 21, 2019)

GBPUSD volatility price chart Brexit

Aside from Brexit, upcoming EU Parliamentary elections which the UK will partake in could stoke additional GBPUSD volatility as well. Moreover, the cable has potential to swing during Wednesday’s trading session in response to UK inflation data due for release at 8:30 GMT. A red-hot reading on the CPI may prop up the British Pound as it is likely to support hawkish BOE bets.

However, BOE Governor Mark Carney has shied away from economic data readings, deferring to a ‘wait-and-see’ approach due to the vast outstanding Brexit uncertainty. OIS futures are currently pricing an 18.9 percent probability that the BOE raises rates by its November 7 meeting – the central bank’s first gathering following the October 31 Brexit deadline.

GBPUSD PRICE CHART: DAILY TIME FRAME (DECEMBER 21, 2018 TO MAY 21, 2019)

GBPUSD Price Chart Technical Analysis Outlook

According to GBPUSD 1-month implied volatility – which is expected to encompass the upcoming EU Parliamentary election results and the fourth Withdrawal Agreement vote anticipated to take place in early June – the cable is estimated to trade between 1.2440 and 1.2958 with a 68 percent statistical probability over the next 30 days.

- Written by Rich Dvorak, Junior Analyst for DailyFX

- Follow @RichDvorakFX on Twitter

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

DISCLOSURES