GBP: Political risk volatility contained for now – MUFG

💡 DMK Insight

The recent volatility in GBP is a wake-up call for traders: political risks are back on the radar. With EUR/GBP spiking to 0.8742, this movement signals heightened uncertainty surrounding UK politics, which can lead to rapid shifts in currency pairs. Traders should be cautious, as the pullback to 0.8700 suggests a potential consolidation phase. Monitoring the political landscape and any upcoming announcements will be crucial. If the Pound continues to show weakness, we could see a test of lower support levels, which may affect correlated assets like UK equities. On the flip side, if political tensions ease, a rebound could push EUR/GBP back toward recent highs. Keep an eye on the daily chart for breakout patterns and set alerts around these key levels to capitalize on potential swings.