GBP falls as Brexit Talks near Collapse

by Oct 9, 2019Market Reviews

GBP falls as Brexit Talks near Collapse

Following reports pointed at an imminent breakdown in Brexit talks on Tuesday, the British pound fell over 0.6 % to the lowest level in months, $1.22.

Prime Minister Boris Johnson told German Chancellor Angela Markel that a Brexit deal is next to impossible if the European Union wants Northern Ireland to stay in the customs union. With news emerging that the British Government is preparing for the talks to collapse as progress over the last few weeks have been minimal.

As writing, the GBP/USD is currently trading at the 1.22231 mark, testing a key support area established way back in early September. We could see a rejection at this support followed with a move to the upside, as a consolidation zone appears to be forming between the 1.22 support and 1.23 resistance areas.

However, uncertainty surrounding Brexit could continue pushing Cable downwards and we may see it break through the 1.22 mark.

European stocks took a plunge along side Sterling on Tuesday, as the risk of a no-deal Brexit increased following reports of imminent collapse talks. Furthermore, optimism for a US – China trade deal has quickly faded, prior to the high-level meeting set to take place this Thursday, after the White House added another 28 Chinese production firms to the so called “Blacklist.”

With Beijing’s response stating that they will take firm measures to protect the nations sovereign security.

  • DAX 30: dropping 127 points / 1.1%
  • FTSE: 55-point loss / 0.8%
  • CAC 40: 65-point loss / 1.2%
  • IBEX 35: 104-point loss / 1.2%
  • FTSE MIB: 246- point loss / 1.1%

Related Posts

New Zealand dollar push to 70c?

New Zealand dollar push to 70c?

New Zealand dollar to 70c? As the dollar continues, it's a downward spiral, risk-on currencies such as the New Zealand dollar have seen a rise in value. I have talked about how the market is slowly pricing in the long-term effects of the Coronavirus on...

read more
Interest rates, Non-farm payroll – Week ahead

Interest rates, Non-farm payroll – Week ahead

Coronavirus cases have passed 18 million across the globe, with deaths approaching 700k. Markets are slowly pricing in how the Coronavirus is affecting countries’ respective markets. The US Dollar is down 10% from its March highs, and the ASX is slowly edging down, booking losses three weeks in a row. This is your week ahead.

read more
Pound rallies on weakening dollar

Pound rallies on weakening dollar

GBP/USD broke 1.30 today, a critical resistance that signals a strong bullish sentiment on the Pound as the dollar weakened on the Fed, sending full message support. Jerome Powell stated that they would keep all support lines open, including bond-buying, low-interest rates, and central bank dollar swaps. Jerome Powell emphasized, “[the fed] is not thinking about thinking about thinking about raising rates.” Andrew Slimmon, Senior Portfolio Manager at Morgan Stanley, stated that the “Fed would keep supporting risk assets.”, suggesting that it would be an excellent time to be long in risk assets.

read more

Black Bull Group Limited (trading name: BlackBull Markets) is a New Zealand registered and incorporated company (company number: 5463921). We are also registered with the Financial Services Provider Register (number: FSP403326).

Black Bull Group UK Limited is registered in United Kingdom, Company Number - 9556804. Payment clearing services provided by: BlackBull Group UK Limited (Company Number - 9556804) Address - 483 Green Lanes, London, Greater London, United Kingdom, N13 48S

Risk Warning: Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and, therefore, you should not invest money you cannot afford to lose. You should make yourself aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any questions or concerns as to how a loss would affect your lifestyle.

Copyright © 2020 Black Bull Group Limited. All Rights Reserved.

Share This