Over the weekend, Brexit is back on the headline as UK PM Theresa May is said to trigger Article 50 by March to formally kick start Brexit process. To wit:
“Prime Minister Theresa May has declared there will be “no unnecessary delays” in kicking off negotiations to leave the European Union, confirming she will begin the two-year process by the end of March 2017.
The announcement, at the Conservative conference in Birmingham, means the UK’s membership of the 28-nation bloc is likely to end by the summer of 2019.”
The Great British Pound (GBP) gapped down on the news, before retracing slightly to fill the gap where we cut all GBP positions until the dust settles. As of 3:30am, GBP is taking another leg down with GBP/USD plunging below 1.29 and lowest level since August:
The increase in volatility means there will be plenty of two way day trading opportunities particularly in our favorite pair GBP/CHF, which we will look to reload near 1.2450 area. Will be keeping a close eye.
US equity futures are unfazed as Brexit and US markets are increasingly uncorrelated. Dow futures still hugging the descending trendline and on verge of breaking above.