Central Bank Unease: Fed Caps Week of Emergency Actions As Markets Panic

In an earlier post on Sunday, I provided reasons to believe that the market was finally drawing a line in the sand for a sustainable bottom. With anticipation, I pronounced I would go on a shopping spreed down to S&P 500 (SPY) 2600. At the time of writing, it looks like I may have to … Read more

British Pound: From Organized Chaos to Orderly Selling

The freefall in the British pound is even more clear in the GBP/JPY pair.

Three months ago, I wrote about the “organized chaos” in the British pound (FXB). I described an organized process of GBP/USD bouncing off and pivoting around key moving averages with the occasional sharp interruption of Brexit-related trades. Ironically, the sharp Brexit-related rally that sparked that post looks now like the British pound’s last gasp for … Read more

Forex Critical – The British Pound Moves On: Out With May, In With Hope

Tears In May Three weeks ago, I wrote about my skepticism about the strength of the British pound (FXB) in the wake of a resounding political defeat for the Conservatives. Brexit-related moves in the pound have proven fleeting and this time was no different. The pound peaked right after that post, but the persistent nature … Read more

Forex Critical: The Organized Chaos of the British Pound

Chaos After the divided politicians of the United Kingdom managed to postpone Brexit to October 31, 2019 from March 29, 2019, I assumed the British pound (FXB) would take a break from wild and sudden gyrations. I was wrong. On Thursday, local elections plunged the Conservative party (the Tories) into a resounding defeat that most … Read more

British Pound Hits A Post-Brexit Support In the Wake of Monetary Swirl

When U.S. Treasury Secretary Steve Mnuchin helped send the dollar careening with commentary welcoming a weak dollar, the British pound (FXB) surged enough against the then hapless U.S. dollar to make me speculate on GBP/USD reaching a blow-off top. GBP/USD did indeed pull back from that point, albeit in very choppy fashion, for almost a … Read more

The British Pound and Mark Carney: Lots of Noise and Little Action

The following chart reminds me that except for one post-Brexit emergency rate cut and its rapid reversal once the cut turned out to be unnecessary, the Bank of England (BoE) has done nothing with interest rates in the 9 years since the financial crisis. Source: Bank of England During an interview with the BBC on … Read more

Forex Critical: The End of A Parabolic Surge for the British Pound

Traders have thoroughly beaten up on the U.S. dollar (USD) for the last six weeks. In the past week, the selling accelerated again in the wake of commentary from U.S. Treasury Secretary Steve Mnuchin that the U.S. welcomes a weak currency because of its positive impact on U.S. exports. The British pound (FXB) is one … Read more

Forex Critical: British Pound and Mexican Peso – A Tale Of Resistance

In recent days I wrote about the British pound (FXB) and the Mexican peso. In both posts, I pointed out to resistance levels versus the U.S. dollar: GBP/USD and USD/MXN. In both cases, those resistance levels held. In the case of the pound, the technicals held against major fundamental news: the Bank of England (BoE) … Read more

Forex Critical: Speculators Back Down At A Critical Juncture for the British Pound

When speculators finally flipped bullish on the British pound (FXB), it looked like the action came right as the currency was making a peak against the U.S. dollar (DXY0). The timing of my observation happened to mark the bottom for GBP/USD, and now speculators have backed down from their nascent pound bullishness. They now hold … Read more

A Wilting British Pound Reverses Gains from A Hawkish Bank of England

It looks like speculators flipped the script to go net long on the British pound (FXB) just in time to catch a peak. Source: FreeStockCharts.com As the chart above shows, GBP/USD just broke down below support at its 50-day moving average (DMA). The move looks like an exclamation point following the full reversal of the … Read more