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