First sign of a bottom?
Cable is below 1.28 and testing the early in the day low.
It’s been a rough week for the pound but going into the weekend, the risks run both ways. Fears of a chaotic end to Brexit talks have led to heavy GBP trying to sell this week and that’s perhaps not going to disappear completely completely but there will be an ebb and flow.
There’s a fair chance that the UK government backs down on the weekend and tries to fix fences. If so, the pound could rally.
The future is unknowable but with cable just 30 pips from the lows, there is a decent risk-reward here and a solid chance we see some profit taking in shorts into the weekend. However watch watchfully for moves into the London fix. If there is going to be described as a washout, that’s when it’ll come.
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