- We have CPI y/y and m/m from GBP today which currently GBP is well supported due to good sentiment, fundamentally GBP is actually doing well but sentimentally large short-sellers are still looking for every opportunity to sell GBP. This is going to be a intraday trade only for LONG as the good sentiment and fundamental have been failed to push GBP further; on the contrary, if today we have negative surprise, GBP should be sold off considering it is at critical resistance level now.
- The catalyst is the GBP CPI DATA
- We’re at resistance zone now
- The risk of course is the market reaction toward GBP, since price action is still more favourable to the downside, on the upbeat we’ll only hold if for short-term.
- I’ll manage it with market reaction and overall sentiment
- Yes but only if we have a surprise
CPI Y/Y & M/M
Positive surprise
LONG GBP/JPY
50 pips SL/Profit
30 pips BE
Negative surprise
SHORT GBP/USD
50 pips SL/Profit
30 pips BE
SHORT GBP/USD
SL 300 pips
- We got in at the negative surprise for CPY y/y, it stalled a bit because although we had CPI y/y & m/m as negative number, but PPI was a large surprise number.
So now in the long-term perceptive, the factory’s order price are increasing because of the devaluated GBP, but so far that price has not yet added into the consumer goods - but it will be very soon.
So looking at it, GBP will actually not be able to cut any interest rate further, and on the contrary, it should maintain the interest rate for now as the inflation will actually go up in the future because of the low exchange rate.
Anyhow, we got stopped out at our intraday trade at BE
Profit $38
We’re still in for our IntraDaily trade, and we’re shorting against the USD so for longer prospective, i’m still more confident in this daily trade as USD is still the strongest currency comparing with others, and GBP still has fundamental risk as to the Euro separation next year.
- We might suffers some drawdown and range bond because USD has been bought for many days already, but because GBP has also been bought and there are even larger short-seller waiting to sell GBP, so we’re hedged and most likely will go into sideway.
SHORT GBP/USD
@ 1.2427
SL @ 1.2727
11/17
- we got out of this trade because it's not going anywhere, and although large USD strength this few days, it still couldn't bring down the GBP, so we think the uncertainty and risk has increased ahead of weekend. Get out @ 1.2414.
