GBPUSD guide to the UK 2019 General Election
Given that cable is resting at eight-month highs now above 1.3200, a Conservative victory is largely priced in. However, any further extension for gains will now depend on the size of the majority that they can muster once the votes trickle in.
An overwhelming majority (I reckon somewhere around 30 seats or more) may yet give a push higher to the pound towards the March high @ 1.3381 and 1.3400.
But a slimmer majority may trigger some worries about "getting Brexit done" and could see some selling in lieu of how much optimism has been priced in. All this will depend on how quickly markets turn their attention to Brexit risks.
After all, no matter the majority in a Conservative victory, the risk of a no-deal Brexit will still be present when looking at future trade relationship negotiations next year.
Any other result besides the two above should see the pound take a massive dent towards testing 1.3000 first before revisiting levels below the key figure.
A hung parliament - don't rule this out just yet - will mean that the Brexit impasse may yet continue and I reckon we could see cable revisit its 200-day moving average near 1.2700 with any Labour-led government set to trigger more downside risks below 1.2500.
Let me know your view on this.
An overwhelming majority (I reckon somewhere around 30 seats or more) may yet give a push higher to the pound towards the March high @ 1.3381 and 1.3400.
But a slimmer majority may trigger some worries about "getting Brexit done" and could see some selling in lieu of how much optimism has been priced in. All this will depend on how quickly markets turn their attention to Brexit risks.
After all, no matter the majority in a Conservative victory, the risk of a no-deal Brexit will still be present when looking at future trade relationship negotiations next year.
Any other result besides the two above should see the pound take a massive dent towards testing 1.3000 first before revisiting levels below the key figure.
A hung parliament - don't rule this out just yet - will mean that the Brexit impasse may yet continue and I reckon we could see cable revisit its 200-day moving average near 1.2700 with any Labour-led government set to trigger more downside risks below 1.2500.
Let me know your view on this.
The 200 hour MA comes in at 1.3101 (call it 1.3100)