When Theresa May called a snap General Election on April 18 she insisted that the reasoning for going to the country 3 years early was that the United Kingdom needs Strong and Stable leadership as the country negotiates a favourable Brexit deal with the EU. This Strong and Stable slogan has been repeated ad nauseam in the election campaign since and has come to be a mantra offered as the definitive answer to every question asked of the Prime Minister.

So how do the currency markets view Theresa May’s Strong and Stable? The GBP-USD currency pair has been relatively stable with even a slight upswing for GBP but let’s consider that currency pair as a related function to another pair, May-Trump.

In the perspective of GBP-EUR however there is a different story to tell. Strong and Stable is not what we see. Instead the soundbite might be Weak and Wobbly as GBP noses downwards. In fact, since the election was called on April 18 GBP enjoyed a slight and very brief gain before setting a steady downwards course that has seen Sterling shed 4,5% of its value against the Euro in pretty much a straight line depreciation. Of course the UK media is silent on this as it sets the wrong focal point against which to measure the election campaign as Weak and Wobbly isn’t the message

However, for every cloud there is a silver lining. Although the slump has been fairly linear there have been a couple of blips that offer suitable volatility to make and take a profit. In 8 separate trading days from the last 39 (to May 31) GBP has made small gains against EUR. For the FOREX pro this is business as usual but for the less experienced trader it takes a great deal more nerve to hold out for these blips.

It is exactly these types of scenarios that ioNectar has been developed to effectively identify, participate and exit with an incremental gain. This is the strength of the ioNectar platform as it holds its nerve at every movement of the market and distributes its liquidity to take a gain; increment by increment, point by point, trade by trade. So the GBP-EUR relationship has not been any riskier than any other currency pair over the past 39 days. The message to take from this is that ioNectar can move the less experienced trader to the same level as the FOREX pro. Now, that really is Strong and Stable…

Phil Lawrence

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