A Pound of Flesh

I have written about the Pound and the doom loop, stagflationary situation in a couple of recent notes. Questions for 2025, and in this week’s preview note Week Ahead - Jan 13-17.

I won’t rehash the points discussed, but instead present some possible trading ideas.

The Pound is trading very poorly, down almost 9% since the September FOMC rate cuts. What’s surprising in its recent action has been that the UK is not really primed to be a big trade wars candidate, yet it has broken through key levels. The chart below suggests we will soon test 1.18, and then possibly the Liz Truss 2022 levels.