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Risk-Reward Not Attractive For GBP Longs Right Now –

The pound had its share of volatility in 2016 and the tendency is not necessarily to the upside, explains the team at BNP Paribas:

Here is their view, courtesy of eFXnews:

The recent slowing in the UK’s dataflow is compounding the effects of political uncertainties and keeping rates markets inclined to price for small risk of policy easing rather than the early 2017 rate hikes that we expect.

BNP Paribas STEER was last week indicating that the GBP appears overvalued versus the USD, with the decline of cable bringing the pair back towards its STEER. The soft dataflow, in addition to the upcoming political risk, suggests that there is scope for another period of GBP undershooting it’s STEER as has been seen several times this year.

As such, although we have a longer term bullish view for the GBP, risk reward is not attractive for GBP longs at this time.

GBPUSD brodly in line with STEER

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Yohay Elam

Yohay Elam

Yohay Elam: Founder, Writer and Editor I have been into forex trading for over 5 years, and I share the experience that I have and the knowledge that I've accumulated. After taking a short course about forex. Like many forex traders, I've earned a significant share of my knowledge the hard way. Macroeconomics, the impact of news on the ever-moving currency markets and trading psychology have always fascinated me. Before founding Forex Crunch, I've worked as a programmer in various hi-tech companies. I have a B. Sc. in Computer Science from Ben Gurion University. Given this background, forex software has a relatively bigger share in the posts.