Boris Johnson took over from Theresa May as Prime Minister and it appears markets will be wanting fresh information as to Johnson’s intended Brexit policy before pushing an already heavily-discounted currency any lower.
Indeed, a number of analysts are telling us the current recovery in Sterling is actually technical in nature, without any real substantive underpinning, we therefore wonder just how high the recovery can actually go.
“We think this is simply a short covering bounce in an otherwise pronounced downtrend,” adds Bregar. “UK politics will feature some pomp and circumstance today as Theresa May resigns to the Queen and Boris Johnson is formally asked by her majesty to form a new government. Next up for GBP traders will be Boris Johnson’s new cabinet minister selections.”
The Franc safe haven status outweighs the negative interest rates given the stability of the Swiss government and its financial system. Thus, when the global markets turn down, the Swiss franc tends to appreciate.
Monthly Chart (Curve Time Frame) – monthly supply is at 1.47000 and monthly demand is at 1.22000.
Weekly Chart (Trend Time Frame) – the trend is sideways with a downside bias.
Daily Chart (Entry Time Frame) – although price is in higher time frame demand, the chart suggests price can move lower and to short price at the daily demand at 1.23900.
This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.