The British pound has been all over the place during the trading session on Thursday as rumors continue to swirl about the ability for officials to reach some type of deal, as a couple of errant comments have from the markets into disarray. In this type of environment, it is almost impossible to trade the British pound in the more liquid pairs, let alone against the Japanese yen which is very quick to say the least. We have seen this movie before, because quite frankly it seems as if hope springs eternal, and therefore people will jump into the markets only to be disappointed later.
GBP/JPY Video 02.20.20
Because of this, I believe that we are more than likely going to continue to “fade the rallies”, unless of course they actually have the ability to come to some type of agreement. All of that being said, news flow will be fast and furious at times, and can send this market 100 pips in one direction or the other in an instant. We have seen that already early on Thursday, so one would have to see this as a sign that the market is still very clearly looking towards the Brexit situation for guidance, and quite frankly that is probably going to continue to be the case. In other words, we are going right back to where we were just a few years ago, with algorithms trading the latest headlines and of course errant comments that politicians make as they play games with each other via the news.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
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