Sterling pairs, the major focus of all traders and investors amid Britain’s June referendum where the citizens will decide whether their nation should remain or exit the European Union.
What could happen on the GBP related pairs? Will they collapse or stabilize after June’s referendum?
Huge fluctuations and high volatility are expected to take place after the referendum’s outcome.
The traders and the investors must, therefore, focus on managing their orders right to avoid exposure and imposing their balances at risk.
Sterling pairs before and after the referendum
The big question is, where will the GBP related pairs move next, higher or lower?
A probable scenario could be the case where the pairs, before June’s referendum, oscillate aggressively higher while after the referendum drop to lower zones.
The market, the traders and the investors will somehow attempt to boost such pairs far upper so that they can, later on, manage the aggressive downside move that will likely take place.
Taking into consideration, for example, the GBP/JPY pair, the price could escalate to the 165.00 and 168.00 range before June’s referendum.
Upon June’s referendum outcome, the GBP/JPY pair may retrace aggressively to the downside, thus somehow correcting the upside move before the referendum.
On the other hand, the vice versa scenario could take place where the GBP/JPY pair could drop to lower zones, before the referendum, such as the 158.00 and 156.00 levels, and retrace, after the referendum, back to 160.00 and 162.00.
Similar scenarios may take place on the other GBP pairs, such as the GBP/USD, GBP/CAD, GBP/AUD, EUR/GBP, GBP/CHF and GBP/NZD.
Risk and Money Management
What’s for sure, though, careful and appropriate risk and money management will be needed to safeguard one’s trading account.
Failing to implement capital management could result in big losses.
Capital control, safe leverage and careful trading are essential especially now!