Still Breeze Before Brexit

Hello, my friend!

Today we are going right in the thick of the action and start trading with EUR/GBP.

Generally, all the risks around EUR/GBP are getting lower and came very close to the acceptable risk level. However, nowadays it is a quite dangerous time because on March 29 the UK plan to leave the EU. So, there are grounds for the strengthening of the GBP because now it will remain in the spotlight and all possible scenarios had been thought out. There are two of them: hard exit or light exit. The last one implies maintaining arrangements between the EU and the UK.

Picture 1. A chart of EUR/GBP for 11.02.2019 - 11.03.2019.

As we can see in picture 1, there is a specified trend, which persisted through all the last month. Moreover, we can see that volatility had been decreasing along with this trend, which implies lowering of the risk. However, let's keep in mind that it is only the calm before the storm that will come as a thunderbolt later.

Anyway, at this moment there is an excellent opportunity to take advantage of low volatility and win over this trend.

Picture 2. A chart of EUR/GBP and the index of big traders for 11.02.2019 - 11.03.2019.

As we can see in picture 2, the index indicates a significant growth of the GBP and the possibility of lowering EUR/GBP soon. Moreover, such a hard lowering was interpreted by market traders as "lost" interest for the instrument and overselling record levels of the EUR, which actually provoked market correction. However, such a correction will not last for a long time and soon will result in a continuation of the trend.

So, in such a situation we recommend you to open positions with a moderate level of risk for this asset because this trading looks more and more like surfing over massive waves.

Recommendation: invest "lower".

Good luck, my friend!