GBP crosses/Trade Ideas

Cable: Still needs to break above 1.5600 for further impulse

Have a look at the long term GBP/NZD chart and you get a sense of just how far the GBP has fallen in recent years. I know the situation in the UK isn’t great but I’m not sure that we should be getting bearish at these lowly levels. This particular pair looks like it could easily rally by 10% without endangering the down-trend.

The cable has been capped in recent weeks near a 50% retracement level just below 1.5600 and it needs to break back above this in order to generate fresh momentum.

  1. Sean, The more I think about GBP/NZD, the more I am of the opinion that it is more of the NZD short than GBP long. If we look from this side which cross is the best to play hypothetical NZD weakness? The only reason I like GBP, is because it has high multiplier to USD and it was sold hard over last 5 years. But what other crosses would you think of? I am out of AUD/NZD long for now, simply afraid of retest of lows. JPY/NZD is tempting, especially in lightof failure at 100. The other observation that sits in my head is that NZD/USD is printing tops couple weeks after AUD/USD. Which was exactly the case recently… So in other words which cross is the most ready timing wise for the next week or two in your opinion?

  2. Geezz, strange stuff, I am watching it, will stay away untill dust settles. I am playing short in equities and it does not work the way I have expected.

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