Wednesday 30 January 2019

POUND’S HEAVY HIT FOLLOWING THE UK PARLIAMENT’S BREXIT VOTE.

The Pound suffered sharp losses yesterday after an unforgettable night of votes in the British House of Commons revived fears of a ‘no-deal’ Brexit scenario.

Sterling was an easy target for bearish investors after MPs voted against the Cooper amendment that would have provided a safety net against a ‘no deal’ outcome. Although the passing of the Brady amendment came as a win for Theresa May, this proposal was immediately rejected by the European Union. With less than two months until the official Brexit divorce date and Brussels warning that the backstop is “not open for renegotiation”, the odds of an extension to Article 50 are rising. While this scenario has the potential to support the Pound as investors completely discount fears of a ‘no deal’ Brexit, the continued uncertainty will most likely cloud the currency’s medium- to longer-term outlook.

Taking a look at the technical picture, the GBPUSD is nursing its wounds today with prices trading marginally below 1.3100 as of writing. Although the trajectory points to further upside, Brexit developments have the ability to overshadow the technicals. Bulls have the ability to push prices back towards 1.3220 as long as 1.3000 proves to be reliable support. Alternatively, a breakdown and daily close under the psychological 1.3000 level is likely to invite a decline towards 1.2940.

Dollar waits on FOMC meeting
Across the Atlantic, much attention will be directed towards the FOMC meeting this evening which is expected to conclude with monetary policy being left unchanged.

Investors will be paying extra attention towards the language in the policy statement to see whether the Fed signals a pause in rate hikes. With the US government shutdown delaying the release of important economic data and uncertainty over trade talks weighing on sentiment, it may be tricky assessing how the US economy has performed. Although the Dollar continues to benefit from safe-haven flows, buying sentiment is seen taking a hit if the Fed sounds more dovish than expected.

Focusing on the technical picture, the Dollar Index is under pressure on the daily charts. Sustained weakness below 96.00 is likely to encourage a decline back towards 95.50 and 95.28, respectively.

Commodity spotlight – Gold
It has been an incredibly positive trading week for Gold thus far thanks to market caution and investors clearly avoiding riskier assets in favour of safe-haven investments.

For as long as US-China trade tensions, concerns over slowing global growth and Brexit drama continue to weigh on risk appetite, Gold is seen shining throughout the trading week. The zero-yielding metal is poised to receive a welcome boost if the Federal Reserve adopts a dovish tone. With the fundamentals driving Gold marrying the technical, we see vast upside potential. The daily close above $1,308 is seen opening a path towards $1,316 and $1,324, respectively.

Have you heard this? Many Nigerian exporters have been defrauded of huge amount of money in the process of exporting commodities to foreign countries. Do you know why? They were not trained on export operations, management, documentations and the best methods of payment in export trade. This is terrible!!! Nigerians cannot continue to lose money to foreigners in the course of export business. Exporters, why don’t you get a practical manual that teaches the stages of export trade from processing and packaging of commodities to receipt of payment by the foreign buyers. It teaches export operations, export management, export documentations and methods of payment in export trade? It is a contemporary step-by-step guide to export trade. It tells all the contemporary dynamics in export trade. To get it, click on the link below:
http://www.tectono-business.com/2016/02/contemporary-step-by-step-guide-to.html

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