Despite releasing strong economic data for the month of May, I believe the GBP/USD climb has not only ended (as exhibited with its 150pip drop last friday) but the decline is likely to continue further.
The 150pip drop was due to to news that the governing Conservatives' lead over the Labour opposition down to just 5 percentage points weeks before the parliamentary election.
Hence, the GBP/USD is likely to go through a period of volatility and uncertainty, up until the UK elections on June 8th.
Coupled with the US Non Farm Payroll to be released on Friday 2nd June, if we see a positive, strong USD data, the GBP/USD could entend losses to around the1.2600 level.
This presents a very good opportunity to take advantage with short term shorts of the GBP.
The results of the NFP is a major unknown, which would affect the performance of the USD drastically.
Therefore, traders should be wise not to predict the data, but to prepare trade opportunities in either the good/bad data scenarios.
The 150pip drop was due to to news that the governing Conservatives' lead over the Labour opposition down to just 5 percentage points weeks before the parliamentary election.
Hence, the GBP/USD is likely to go through a period of volatility and uncertainty, up until the UK elections on June 8th.
Coupled with the US Non Farm Payroll to be released on Friday 2nd June, if we see a positive, strong USD data, the GBP/USD could entend losses to around the1.2600 level.
This presents a very good opportunity to take advantage with short term shorts of the GBP.
The results of the NFP is a major unknown, which would affect the performance of the USD drastically.
Therefore, traders should be wise not to predict the data, but to prepare trade opportunities in either the good/bad data scenarios.
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