Search ForexCrunch

UK exit polls are shocking  by  showing no absolute majority for the Conservatives in an election that was supposed to be a landslide.  While polls narrowed towards the vote, they still showed a healthy lead for PM Theresa May.

GBP/USD is crashing nearly 2% to the 1.27 handle. However, this may be a buying opportunity. Here are three reasons for this idea. What do you think?

  1. Trading volume is thin: So, the reaction is exaggerated. Tokyo opens at 00:00 GMT and perhaps we will see a better reaction, for good or for bad.
  2. Exit polls underestimate the Tories: Real results could put them at 326 or higher.  In 2015, polls gave CON a smaller majority than what actually happened.
  3. A coalition could lead to a softer Brexit, especially if the Lib Dems are inside.The small party  were 100% pro remain and campaigned for a soft Brexit. A softer Brexit means a better trade deal with the EU.

UK elections – all the updates in one place

Here is the chart