Perhaps, the Brexit insanity can best be encapsulated by a recent Reuters article, which reports that computers designed to trade on Brexit-related news have been flummoxed by the barrage of recent headlines that at times appear to be contradictory.
The Reuters piece says that a portion of the roughly $5 trillion-a-day global currency that has been controlled by computers, which are modeled to watch for key words from media sites about the U.K.’s divorce from the EU and trade off of that information, are being whipsawed by thousands of daily headlines on the subject from the likes of Bloomberg, Reuters and other outlets (including this one).
Chandler explained that volatility has become a more consistent part of sterling trade even as traditional speculators have moved to the sidelines amid the uncertainty surrounding outcomes for Brexit.
The volatility due to Brexit on the forex British Pound pairs have been great, but has been chopping traders left and right, which is more the reason to look for set-ups on the higher time frame charts. Every weekend I scan the majors, the minors and now some of the exotics looking for swing trades. So, let me walk you through what I’m seeing on some of the Pound pairs.
The monthly trend is actually up, but pulling back to the monthly demand at 0.83500. A trader can look for pull backs on a lower time frame to ride price down to the monthly demand.
I have an alert set on the daily chart, so if price retraces to the daily supply at 0.87500, I’m looking to short this forex pair.
I talked about this pair some weeks ago. The monthly chart is trending up.
I missed the trade already, if price comes down to the 4 hr demand, pending price action, I’m going long with the hope of riding this pair to the monthly supply at 2.0500.
On the monthly chart price is range bound, so I’m going to pass for now on this pair.
On the monthly chart, price is range bound, but lets examine price on a smaller time frame.
Might be worth going long if price makes it back to the daily supply at 1.2800.
Potentially can lower the risk by taking the trade on the 4 hr chart, if price gets to the 4 hr demand at 1.2790.
On the monthly chart, price is range bound.
You can see price already hit the daily demand at 141.00, but a the set-up is to take price short if price makes it to the daily supply at 150.00.
On the monthly chart, price is range bound, will pass on this chart.
On the monthly chart, price is range bound, but the momentum is down.
Price did hit the weekly demand at 1.3400, but I was waiting for price to move a bit higher before shorting this pair.
So I added an alert on the daily chart to potentially go long if price makes it to the daily demand at 1.2915. However, this trade set-up would be going against the monthly downward momentum.
This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.