Cable has seen a big move over the last couple of days, but the usual whipsaw of undecided speculative traders means not much progress has been made. That also goes for the stories dominating the pair despite an uptick in the newsflow over the last couple of weeks. After a crazy day yesterday Cable is now trading back above 1.3200 while EURGBP trades down at 0.8860.
Regarding Brexit the news keeps flowing, but yesterday the Irish border issue was there to hit hopes of an autumn deal with the EU. After the key summit between of EU leaders, Donald Tusk said that the UK must “rework proposals on Ireland, and future trade”. Ireland remains the biggest blocker to a Brexit deal, and still has the potential to stop Brexit happening altogether. It seems that optimism is growing around the other issues with Theresa May seemingly winning back some critics and gaining support in Europe.
The technicals are hard to decipher right now in the short term while on the long term it looks like a textbook V reversal is in play. This morning’s retail sales number for August yet again showed that the good summer weather has boosted spending in the UK, which is a welcome boost for the high street. We can add this to the strong numbers over the last couple of days, and we have a fairly positive UK picture playing out in the short term.
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Too much uncertainly in the world