1. Lower interest rates - The Bank of England will cut interest rates to contain the economic fallout form the referendum
2. Capital outflows - British property investors are selling their investments and three real estate funds have halted withdrawals amid the turmoil. M&G Investments has stopped trading in a GBP 4.4bn fund, following similar announcements from Standard Life Investments and Aviva Investors.
1. more property funds cut the valuations of their underlying assets. Legal & General Investment Management has reduced the valuation of its property fund by a further 10 percent, from a 5 percent cut earlier. 7 UK property funds have suspended dealing or made valuation adjustments on their property funds.
2. Rating agencies have cut their outlooks on UK banks to negative, with possible downgrades in the short term. S&P has cut outlooks on HSBC, Barclays, Lloyds and the UK unit of Santander.
Despite the rally this afternoon, economic fundamentals for the Pound have not improved.
Bloomberg reported that the Pound has overtaken the Argentinean Peso as the year's worst performing currency
In addition, the UK is clearly in panic mode as they are thinking about cutting corporate taxes and opening the doors to Chinese investors.
These are favourable policies for Britain in the long term, but there is so much more uncertainty in the short term.
Overall, economic fundamentals for the GBP is poor and there remains no sight of any upside catalysts.
May has indicated the formation of a new Brexit department with a secretary of state at its helm.
She is also not in a hurry to discuss exit talks with EU leaders and emphasized her priority to have continued access to EU markets without immigration.
I remain bearish on the British Pound despite the rally in the currency.
Any level above 1.33 is a rare opportunity for shorting.
The Bank of England is set to meet on Thursday, where the Committee is expected to cut interest rates from its current level of 0.5%
I am still bearish on the currency longer term, fair value for the currency is likely 1.33, so any rise above this point is a shorting opportunity.
News came in this morning that the Survey of the UK housing sector from the Royal Institute of Chartered Surveyors, suggested that new buyer enquiries had dropped to their lowest level since the dark days of the global financial crisis in 2008.
In addition, expectations of future sales from the surveyors questioned dropped to their lowest level since the survey was instigated in 1998.