Cable hits a fresh session low of 1.2651 currently
The decline in the pound since two weeks ago has been an ugly one and is evident in the cable chart above. Price hit a high of 1.3185 on 6 May as cross-party talks seem to build up hope only to see it all crashing down thereafter as we're stuck with yet another vote on Theresa May's already beaten-to-death Brexit deal.
As it stands, as long as May stays in office, we only can afford to wait until her deal gets shot down again on the first week of June. Her leaving before that - forcefully or willingly - may provide a temporary reprieve for the quid but the key word there is temporary.
Whoever gets elected will not have an easier task and may just have to start from scratch again, with an even tighter deadline. The EU is fast running out of patience and if push comes to shove, a Brexiteer like Boris Johnson may yet just decide to pursue a no-deal outcome instead of haggling back and forth.
As mentioned earlier, support in cable is only seen further around 1.2620-30 levels so expect that area to be the next key spot for buyers to lean on before light bids around 1.2600 will be called into question for a further defence.
But as it stands, the old market adage of "don't catch a falling knife" is very apt for now. I'd rather be late to catch a reversal in the trend than risk getting my fingers chopped off in times like these.
Update: Price now falls below 1.2650 to even fresher lows. Ouch.
