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
More View more
Real Time News
  • Was an absolute please to be back on @ausbiztv again today with @NadineBlayney discussing the Australian Dollar ahead of the #RBA (due in 30min!) Check out the full clip below for my thoughts on where #AUD #AUDNZD may go here - https://t.co/XqMHkiLkid https://t.co/vY6vutdGjg
  • Wuhan to conduct citywide Covid tests after infections found -BBG
  • (Equities Special) Nasdaq 100 Forecast for the Week Ahead: Tech May Outperform the Dow Jones #NASDAQ #NASDAQ100 #DowJones #NFPs https://www.dailyfx.com/forex/fundamental/article/special_report/2021/08/03/Nasdaq-100-Forecast-for-the-Week-Ahead-Tech-May-Outperform-the-Dow-Jones.html?CHID=9&QPID=917702&utm_source=Twitter&utm_medium=Dubrovsky&utm_campaign=twr https://t.co/XhNIvtiBFD
  • 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/cg1xX4B68o
  • Emotions are often a key driving force behind FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here: https://t.co/eILWbFgHRE https://t.co/iE8mGqZtLX
  • Commodities Update: As of 02:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.17% Gold: -0.11% Silver: -0.24% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/le5P0D0CaR
  • Forex Update: As of 02:00, these are your best and worst performers based on the London trading schedule: 🇳🇿NZD: 0.31% 🇯🇵JPY: 0.09% 🇬🇧GBP: 0.06% 🇪🇺EUR: 0.03% 🇨🇭CHF: 0.03% 🇨🇦CAD: -0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/tEzSWPH3NA
  • Tencent Holdings (700 HK) slumped over 9% amid fears about regulatory risks over the gaming sector. Chinese state media published an article on Tuesday citing online games as "opium" to teenagers, spurring concerns about Tencent's future. https://t.co/4uFjwKh3kC
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Silver are long at 92.81%, while traders in France 40 are at opposite extremes with 79.46%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/aKwIeXVnVk
  • 🇦🇺 Investment Lending for Homes (JUN) Actual: 0.7% Previous: 13.3% https://www.dailyfx.com/economic-calendar#2021-08-03
GBPUSD Currency Volatility: Brexit Latest Rattles Sterling

GBPUSD Currency Volatility: Brexit Latest Rattles Sterling

Rich Dvorak, Analyst

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