ridethepig | EURGBP Market Commentary 2020.07.08

📍 The following position comes after a temporary concession break of 0.90x strong support. After sellers came crumbs away the first time, buyers felt at liberty to allow the breach and trap more on the counterplay.

The mysterious trap is coming and buyers wish to occupy the 0.90xx handle rather fast to rule out any cheap entries. At the right moment, we can double down on momentum as price develops.

Let me say a few quick words about the birth of this position; it is closely linked to the GBP devaluation via Brexit and the history of protectionism positional plays...

First there was the complete control of Downing Street and the Treasury, the "no-deal" hijacking was only possible from this populists.

📌 Then came the stratagem of a covid flank which rendered the first 1.15xx test, sellers could not breakdown without profit taking and loading a second barrel. Moreover, the GBP weakness can be played in the crosses:

Admitting the damage of Brexit is worth considering for those still thinking this environment is +ve for GBP. The threat of negative rates would mark the official surrender.

Thanks as usual for keeping the feedback coming 👍 or 👎

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Sellers take it again. Well played shorts.