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Brexit Whispers Having an Impact

By:
Yaron Mazor
Published: Jan 18, 2018, 11:44 UTC

The Pound continued to put in gains on Wednesday, even as the U.S Dollar was stronger against other major currencies.

brexit

The Pound is above 1.38 and Brexit whispers from the U.K political sphere are having an impact.

Additional Gains for the Pound

The Pound made additional gains yesterday and is above the 1.38 juncture against the U.S Dollar.

GBP/USD 1H Chart
GBP/USD 1H Chart

The ability of the British currency to add value, even as the U.S Dollar was stronger against other major currencies on Wednesday is a signal the Pound offers a unique dynamic.

Brexit Possibilities Changing

Political conditions in the U.K are pointing to the possibility of a soft Brexit. While it doesn’t mean Britain is reconsidering the Brexit in total, it does highlight a change in attitudes in the U.K as certain economic realities are debated.

GBP/USD 4H Chart
GBP/USD 4H Chart

The Pound has gained significantly in the past few weeks against the U.S Dollar and support may be around the 1.36 level, while traders debate what constitutes resistance.

The Difference of Time Perspectives

The Pound has broken through higher price levels so consistently that a long-term chart is the best barometer for future implications. The Pound is still below its pre-Brexit vote values.

The Pound’s significant gains could cause some traders to look for reversals in the short term, but for those with a longer perspective, the British currency may look like a buying opportunity.

GBP/USD Weekly Chart
GBP/USD Weekly Chart

In the short term, we believe Pound may be negative. However, in the mid-term and long-term, we believe the British currency could be positive.

Yaron Mazor is a senior analyst at SuperTraderTV.

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About the Author

Yaron Mazorcontributor

Yaron has been involved with the capital markets since 1998. During the past 16 years, Yaron has been a day and swing stocks trader in the American market. Yaron has founded and made successful investments into businesses spanning exciting industries – from apparel to restaurants and bars, to high tech, medical technology, and education.

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