Risk sentiment taking lead from UK political headlines

We can expect the extreme volatility from last week to continue for a few more sessions at least. The FX market is trading purely off risk sentiment at the moment, with GBP/JPY the obvious lead pair ion that regard.

Liquidity remains very poor indeed and spreads will remain wide for now.

Sentiment is mainly being driven by political headlines out of the UK and Europe.

Trading wise, selling any USD/JPY rallies back towards 105 and buying AUD/USD dips towards .7250 are my preferred strategies. I’m leaving GBP alone for now but I feel we will see a wide 1.30/1.40 range over coming days in the cable.

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