The market’s bouncing over Brexit…

The market’s bouncing over Brexit…

Brexit has been getting the markets a little jumpy again this week…

Yesterday, a report from the Telegraph said that an agreement over Ireland had been met. And a few hours later, this report was flatly denied.

This was how the pound vs the dollar market behaved…


Source: Trading View. Click to enlarge

The arrow on the left shows when the report was announced and the arrow on the right shows when it was denied.

Notice how the size of both moves are almost exactly the same…

This was simply a correction into the previous range (demand).

You can expect a lot of this behaviour over the coming months, with the markets reacting to Brexit negotiation rumours and news.

The market will move one way and even without an opposing report, it’ll probably whipsaw straight back.

The overall Sterling trend is very much set in stone – as you can see in the chart below:


Source: Trading View. Click to enlarge

We are actually 12.5% up from this year’s low, but the media will not tell you this though. They have a ‘Remain’ fetish for some bizarre reason.Adding onto this, we have the Commitment of Traders’ (COT) report identifying that large speculators are turning net bullish on Sterling.

For the past two or so years they have been net bearish – as the chart below shows (the green line in the bottom half of the chart represents large speculators).


Click to enlarge

This gives further reasoning as to why bullish bets on Sterling are a good idea…

…and why the media really should be ignored when referring to the currency markets.

I truly am sick of seeing charts on the news or on Twitter of a 40-tick fall after someone speaks…

Because it really doesn’t mean anything, as I’ve shown you today.