Mitsubishi UFG says to sell cable
MUFG Research maintains short GBP/USD exposure as its trade of the week for the coming week. MUFG is short cable with a target at 1.2630 and a stop at 1.3180.
"We considered cutting this after being very close to getting stopped out this week -- in fact we were only 3 pips from our step being hit on Wednesday with 1.3177 being the recorded high on the day. the bases for this trade was increased uncertainty over trade talk following the failed outcome from the leaders' summit on 15-16 October," MUFG notes.
"However, we will hold on to this trade simply given the broad macro backdrop for the pound remains grim in our view. Our argument for this tread was increased concerns on a deal being reached. We still have that brinkmanship ahead of us and if a deal is done it will be in the final hours and we are still likely to get fears increasing over no deal. So we see limited upside from here."
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Personally, if my fundamental call is off and I dodged a stop by 3 pips and have a chance to get out relatively unscathed, I'm taking it. But best of luck to them.
