The day of the United Kingdom’s referendum on whether or not to remain in the EU, back in 2016, the Pound (GBP) traded against the Dollar (USD) at a rate of US$1.50 per GBP. As the voting results started to come in, and throughout the long night (I’m in the US), the GBP dropped precipitously against the USD. In days to come it would actually drop below US$1.20 per 1 GBP. It was the best trading of the year for me as I rode it down, only exceeded by riding the USD up after Trump’s upset victory against Hillary later that same year.
But here’s the thing, nothing really changed on the day of the Brexit Referendum. And nothing would change for at least 2 years, the period determined by EU Law for exiting their polity. I went on record at the time stating that the doom and gloom crowd would run out of steam eventually, and I set a target for the recovery of strength in the GBP at around US$1.40 per 1 GBP. That target was exceeded some time back. I don’t mind going on record, and I leave my forecasts up and publicly available, regardless of whether I’m right or wrong. I don’t hem and haw, either. My record speaks for itself.
So this is me going on the record again. I’m now looking at a full recovery back to US$1.50 by end of 2018, and if anything, I may be overestimating the time required, it could happen much sooner. My analysis is not based on any bias for or against any currency, it’s not emotional, it’s based on hard, fundamental facts such as the economy of the countries involved, their relative strength, and so on. It’s also based on the technicals I see in the charts.
Looking at this GBPUSD Daily Chart, we can easily see it’s in an upward channel and traveling briskly. That doesn’t mean it can’t break out of the channel to the downside, but the GBP strength is plain to see. Some of it, of course, is also USD weakness, but in general, the GBP is having a brilliant rally. It is about 6-700 pips away from my revised US$1.50 target, and that’s just too attractive a profit staring me in the face.
I’m already in this trade, long term, and happily banking profit as it climbs. This is the sort of thing I do all the time. It’s the sort of thing our students do, since we teach them to find these opportunities in the market. It’s the sort of thing our customers do through the different services we provide that alert them to trade entries. It’s the sort of thing YOU could be doing if you let us teach you or you sign up for our services.
700 pips is $7,000 dollars trading at a full lot size. More, if trading in multiple lots. Is there risk involved? Of course, every reward in life comes with an associated risk, but we also teach you how to limit that risk. There are many ways, too many for me to go into them in a short blog post, but they’re covered extensively in our courses.
And, if you’re reading this, you know that we sometimes throw a trade out there simply because we’re in love with trading and like to spread the joy! But we don’t throw them all out. You have to be inside our tent, in the inner circle. The door’s open. Your move.
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Andres Pedraza
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