Talking Points:
• A long EU Leader Summit closed with reported agreeable terms between the UK and the rest of the Bloc
• Final word rests with the United Kingdom's voters and the referendum can be put up to vote in June
• The implications for Pound trading in this uncertainty are represented by recent election, Scottish referendum
How are retail traders positioning in the British Pound? See positioning figures for GBP and the majors on DailyFX or in your charts using the FXCM SSI snapshot.
The Pound is no stranger to politico-economic concerns that can take control of momentum and volatility. The Brexit is just the most recent fundamental concern to rise over the market's horizon. Whether or not the UK stays in the European Union is a fundamentally complex issue with polls that are remarkably balanced. Heading into this weekend, the EU Leaders Summit in Brussels offered some measure of relief when it was announced shortly after the New York's trading close that both sides reached agreeable terms. This doesn't resolve the situation as the decision rests with the population of the United Kingdom. With a vote still months away, this uncertainty will hang over the Pound with competing influence to BoE rate expectations and may even push it into the role of a 'risk' currency. Looking back at the trading into and around the Scottish Referendum and UK election, we get a sense of how significant the influence can be. We discuss the Pound's tumultuous outlook in the weekend Strategy Video.
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