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By Pound Sterling Forecast (Reporter)
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Where will GBP/EUR sit following the triggering of Article 50?

Tuesday, March 28, 2017 9:57
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(Before It's News)

Could the Pound strengthen?

My opinion on this one is slightly controversial, I am going against the grain. I think that once the dust settles Sterling will sit in a better position than we sit now (1.15). I would not expect significant gains however.

The market moves on rumour as well as fact. Big swings are seen on the exchange when something unforeseen occurs. The triggering of Article 50 is a certainty and we know the date it will occur, Wednesday 29th March. I think this is already factored into current buoyancy levels on GBP/EUR.

When to Trade

Despite my prediction, I would not perform my entire trade after the event. I would move in tranches, maybe 20% – 40% before hand in order to protect myself from potential losses. Be sure to get in touch first thing if this is the case. I had clients during the Brexit vote last year who were adamant Britain would remain in the EU and Sterling would rally, rather than move in tranches, they put all their eggs in one basket. When results came through some clients found their trades had become tens of thousands more expensive. There is sure to be volatility, many seven figure investors are waiting for this event before pushing the button.

If you are holding Euros I would not procrastinate too long, I think the single currency could be in for a rough year. There are two general elections within the Eurozone this year, both of which could see a far-right party gain power, which would result in a referendum. We have already seen the damage caused to Sterling by a referendum. Also keep in mind Italian banks’ bad loans now above the €360bn mark and Greek debt and we could see big falls in Euro value.

If you would like my assistance with your currency requirements I will be happy to help. I will provide an indivdual trading strategy to suit your needs and also provide a comparison against your current provider. I can be contacted at [email protected].


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