There is not much in the way of tradeable Cable releases this week.
*Except* possibly the most anticipated and volatility inducing pre-scheduled economic release that will happen this year – Breferundum day is finally upon us.
To recap, GBP has reacted bearishly to news that could lead the UK to vote out of the EU on June 23.
The converse is true and Sterling rallies on news pointing towards a vote to Remain.
Polls are extremely tight, virtually neck and neck: you can keep track here:
Recent momentum has been towards a Leave vote, meaning Cable is rather depressed. However a general swing back toward Remain seems to be in progress.
Dollar is moderately bullish as consolidation continues pending June’s missed Fed Hike. Incidentally a Brexit outcome will likely trigger a global risk off sentiment which will lead to weak dollar against the safer currencies. As the referendum is a binary outcome, there will be extreme volatility going into and immediately following this Thursday.
Given the total focus on an unknown fundamental this week, do not expect techical indicators to provide much assistance with forecasting price action. Pivots and other guidance such as the stochastic will likely be overridden by news events
Price gapped over 110 pips on Monday’s Asian open, and now resides back in the long term rising channel indicated blue.
Monthly S2 support has been visited and the pair has now rallied over 580 pips since its low on Thursday 17th.
As price touched weekly R2 in the first couple of hours of trading it seems likely that price will not behave normally this week and traders in any GBP pair should be acutely aware of their risk management techniques.