On Friday, the House of Commons rejected Prime Minister Theresa May's EU Withdrawal Agreement for a third. Now the UK will receive from the EU an Article 50 extension until April 12. At that point, PM May will have to choose between requesting a much longer extension that would require participation in the EU parliament elections or a so-called no deal Brexit. As expected, the British Pound dropped due to further uncertainty.
As a result, the GBP/AUD dropped as well and right into my daily demand zone that I have been waiting for. But just to recap the trade set-up from a week ago.
If Theresa May does step down, I anticipate a short sell off in the Pound and because I missed my entry on GBP/AUD on Friday, this may be the event to get in and take it long
Weekly Chart (Trend Time Frame) – the trend is up.
Daily Chart (Entry Time Frame) – the chart suggests to go long on a pull back to the daily demand at 1.8250.
Forex Analysis Report 3/24/19 - Eyeing A Position Trade In GBP/AUD
Unfortunately, I missed the entry as I didn't set-up the trade on my platform before hand.
But if price is able to penetrate the daily demand zone a bit more, there is a 4 hr demand zone where I can still get in the trade to go long.
I was definitely caught off guard as I wasn't expecting price to get to the daily demand zone on a Friday. However, with Brexit's looming and all the uncertainty, I should of known that the volatility in the British Pound, anything would be possible. Be sure I want missing this set-up going into the week ahead.
This post is my personal opinion. I’m not a financial advisor, this isn't financial advise. Do your own research before making investment decisions.
Interesting you are considering long positions on the pound. Fundamentally it seems more likely for May plus No deal to absolutely sink the pound especially as we get closer to Brexit 12th April and the house of parliament is in a total shit show, I've been watching closely and the markets are reacting more to Brexit than ever right now. I would be interested in discussing this further as I have been short on GBP/JPY last fortnight and plan to Short it further for the week ahead, I may have to consider an even tighter stop loss now?
The pound is definitely volatile these days, but I have to go with what the charts are telling me. Nice trade on the GBP/JPY, I wanted to short as well, but it never got to my zone at 150.50
Touche, still room to move upward on your technicals and a so called "soft brexit", these bleeding "indicative votes" are a traders nightmare, typical english politics as well. Only good thing recently is big intraday moves I suppose.