Web Statistics Why sterling's bounce could prove to be very short lived

Monday 18 July 2016

Why sterling's bounce could prove to be very short lived

Why sterling's bounce could prove to be very short lived


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Why sterling's bounce could prove to be very short lived



Why sterling's bounce could prove to be very short lived
Why sterling's bounce could prove to be very short lived




Why sterling's bounce could prove to be very short lived

Why sterling's bounce could prove to be very short lived - or The British pound could be showing signs of a false dawn, according to currency analysts, because some suggest that a recent rally could soon give way to more bouts of heavy selling.

This currency bounce as a major turning point for a firmer British pound moving forward, but rather expect further depreciation later on, as the bounce so far has been VERY WET, WEAK and NOT SUSTAINING!

The result of Britain's EU referendum in June pummeled the pound down to 31-year lows. But a fresh new government, a lack of movement from the Bank of England (BoE), and some good corporate news has steered sterling back on a course higher.

We doubt all this BREXIT crisis is gone away, but that seems to be what other news reports and journalist think. Please we need to warn you about just tossing this problem into the wind. We believe this will FLARE up again, and YES! you heard it here first! And When all the dust settles, I think we'll see new lows for sterling.

Stimulus from the central bank is also seen as negative for the currency with the extra liquidity it creates essentially flooding more pounds into the system. And despite surprising investors by holding rates last week, most members of the bank's monetary policy committee are expecting some sort of loosening in August.
With this in mind, Kallum Pickering, senior U.K. economist at Berenberg, expects trade-weighted sterling to remain at or even below current levels until the end of the year before rising modestly in 2017.

Here is a chart of the pound sterling, as you can see the BREXIT mess really hammered the charts, and it sold off hard! However now the chart is cleaning itself up and it does not look that well. Could this just be a dead cat bounce. All it needs now is some brexit news catalyst. That it seems in not that far away!! As we previous described!. [See the Chart below]


Why sterling's bounce could prove to be very short lived
Why sterling's bounce could prove to be very short lived

Of course the govt could work things out and mysteriously find money again to throw into the economy and into the market, but our thoughts are this BREXIT mess is only getting started. YES!........





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