March 29th 2019 is supposed to be the day the UK will leave the European Union and deliver to voters of the 2016 Brexit referendum what they demanded. Then PM Cameron resigned and May took the top spot in UK politics. She herself voter remain and many saw her unfit to deliver on the result of the referendum. During her premiership she had to fight battle after battle which she lost in most cases. UK politics has been divided under her leadership, or as some call it lack thereof, and even her own party is split. The only time May managed to unite all sides of the political spectrum was when Parliament rejected the Brexit deal she negotiated with the EU.
After May promised that the UK will leave on time, she now changed her tone and said she was open to ask for a delay and more time. Opposition Labour Leader Corbyn also changed tone and said that he was now open to a public vote on the final deal or even a second Brexit referendum. Corbyn previously rejected both, but after a series of party deflections he was forced to give in. Many have accused May of running down the clock and at some point she needs to step up and decide if she wants to risk losing roughly 20 pro-EU ministers in her party or angering the much bigger pro-Brexit group inside the Tory party.
After Corbyn changed his position he stated that “One way or another, we will do everything in our power to prevent no-deal and oppose a damaging Tory Brexit based on Theresa May’s overwhelmingly rejected deal.” A second referendum is very unlikely, but Labour’s change of direction could further put pressure on May. She has delayed today’s vote on an amended Brexit deal text which basically delivers the same key points as the one which was rejected by a record landslide defeat in UK politics. The new date is now set for March 12th 2019 or 17 days before Brexit.
As news of a potential Brexit delay circulated trading desks around the world, the British Pound rose amid hopes for more time to either prepare for Brexit or abandon it entirely. May may use the fear of no Brexit to unite rebels in her parry to back the deal on the table. The British Pound may be in for a wild ride over the next few weeks. Open your PaxForex Trading Account now and start building a profitable forex portfolio which you will grow with the help of our expert analysts!
Away from the limelight and media coverage, some experts now believe that the fate of Brexit lies in the hands of Attorney General Geoffrey Cox. It was him who essentially forced a Parliament vote on May’s Brexit deal and it was also him who announced Therese May as PM to a Tory party which generally disliked her; following his introduction speech the party warmed up to her slightly. Cox has been working hard to find a solution to the Irish backstop which remains at the center of the rejection of May’s Brexit deal. In the meantime the EU is unofficially suggesting a 21-month delay to Brexit. How will the Cox Factor play out? Will May Delay Brexit? Here are three forex traders which won’t delay your profits!
Forex Profit Set-Up #1; Sell GBPJPY - D1 Time-Frame
Several headwinds for the global economy have been pushed aside by hopes for improvement which put selling pressure on the Japanese Yen amid a reduction in exposure to save haven currencies. Hopes for a Brexit delay have additionally boosted the British Pound which took the GBPJPY just below the lower band of its horizontal resistance area, enforced by its secondary descending resistance level. Hopes can quickly be crushed by reality and this currency pair is vulnerable to a reversal back. This may take the GBPJPY thorough its primary descending resistance level, acting as temporary support, and into its next horizontal support level. Selling the rallies into the lower band of its horizontal resistance area remains the favored trade.
The CCI is trading in extreme overbought conditions, but has started to retreat from its highs and a negative divergence started to form as a result. This bearish development may ignite a contraction on the back of profit taking, especially once a breakdown below 100 materializes. Subscribe to the PaxForex Daily Fundamental Analysis and allow our expert analysts to guide you through the forex market!
Forex Profit Set-Up #2; Buy EURGBP - D1 Time-Frame
Following the rise in expectations that Brexit may be delayed between three months to twenty-one month, the British Pound gathered bullish momentum. While forex traders turned slightly more optimistic on Sterling, the continuous wave of negative economic reports out of the Eurozone have pushed the Euro lower. Now the EURGBP is challenging the lower band of its horizontal support area. A breakdown on the first attempt is unlikely which makes this currency pair a perfect candidate for a short-covering rally. This could push price action back up into its primary descending resistance level. Forex traders are therefore advised to spread their buy orders inside its horizontal support area.
The CCI dropped into extreme oversold territory, but has recovered from its lows which allowed a positive divergence to form in this momentum indicator. This represents a strong bullish trading signal which is expected to force a short-term reversal in the EURGBP. Download your PaxForex MT4 Trading Platform today and join our fast growing forex community filled with profitable traders!
Forex Profit Set-Up #3; Sell GBPSGD - D1 Time-Frame
As the risk for a Brexit disappointment increases, which would put downside pressure on the British Pound, the Chinese economy appears to have bottomed out despite the trade war initiated by the US. The risks now remain to the upside which will benefit the entire Asian region. The GBPSGD has pushed higher over the past few trading sessions and price action is now located above its secondary descending resistance level and below the lower band of its horizontal resistance area. A price action reversal on the back of profit taking is anticipated to drop the GBPSGD back down into its primary descending resistance level. Forex traders are advised to sell the rallies from current levels.
The CCI has pushed deeper into extreme overbought conditions and is now approaching its previous high from where a double top formation in this technical indicator may prevent further upside. A drop below the 100 mark is likely to start a price action reversal. Follow the PaxForex Daily Forex Technical Analysis and simply copy the recommended trades into your own trading account; our expert analysts work hard so that you can earn profits the easy way!