Sterling back above $1.62
The pound is trading at $1.6223, slightly higher on the day, and is showing no signs of crawling back the ground it lost to the US dollar in the past week. Even though we could see a big pull back in the pound if Scots vote ‘No’ traders will be reluctant to take a firm long position on the pound.
The bias remains to the downside, and we are now one week away from the referendum. I suspect the pound will be back below $1.61 as the referendum draws nearer. Only a massive surge in the ‘No’ campaign would drive the pound towards $1.6336.