Has the Sterling worm turned?

Well for weeks I’ve been mentioning how Sterling seemed to me to be getting to crazy levels.  Sure, we were long, but I had no clue as to why.  I know that one could say “just trade what you see”, and I do, but somewhere along the line I like to think there is something rational about the markets.

Not so with Sterling.  The rise and rise seemed unstoppable.  Until it did last week.  A nice pullback against the USD (see below) where we have now hit our impulse target.  Some nice profits booked with half our position and we will now ride the rest as far as we can.

Meanwhile against the Aussie, Sterling is not dropping as we expect at all.  Its currently being held by a micro swarm of support (marked in blue) and the next couple of days are crucial for this pair.  The Aussie dollar is, simply, pathetic at the moment.  The really sick man of currencies.  Yet GBP is weakening slightly against it.  I’m selling Sterling n every bounce at the moment as I think sooner or later the Aussie will recover.  And when it does …. Sterling could suffer a hefty kicking.

For now though, really strong support in the 1.81 region – and until that goes we will stay I believe in a tight range from 1.81 to 1.8350.  I shall be buying and selling form the hourly chat with my entries taken from the 15 minute.

Have a great week, traders.  It could be a rock and roll ride.  Let’s see what The Donald says …