OK everything you are about to read is purely theoretical. The big topic for everyone is GBP. The Scottish referendum has created very strange market conditions, instead of the usual floating around in a general direction we are moving into much bigger moves. Over thee weekend Sterling gapped a huge distance.
I think Sterling is preparing to fall like we have never seen it fall or it will stay perfectly still on a no vote.
Part of the reason for this type of rallying up is ofcourse to square up the fall from last week. But in 9 days the vote will happen again, however if there is another YOUGOV poll that shows a yes we may see sterling plummet and then come back the day after.
Take a look at GBPCAD for instance.
The pair is high up CAD has been doing well but now we are seeing Sterling come up and fight it out in terms of strength but both are near extremes. I won’t be taking a long on this one!