The British £ has fallen sharply (again) in the last three days and has now produced extension signals against the three main traded currencies:
There are dire predictions of further weakness to come if there is a 'no deal' Brexit in three months time, which is the EU-decreed moment of Britain's departure. There has been little consideration of the increased effectiveness of Britain's negotiating posture since prime Minister Boris Johnson took over from the lacklustre Mrs May. In our view the likelihood of a 'no deal' Brexit is very small and the markets' view seems too pessimistic by far. We would buy the £ hereabouts, starting immediately and increasing purchases on any sign that this present weakness is ending - on any reversal, in other words.
Still no clarity in stock markets, where we are sidelined. We remain bullish of the UK as we restated in the July 3rd edition.
All signals courtesy of software supplied by our friends at Parallax Financial Research www.pfr.com