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luck isn't a repeatable event.


Soros was ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“longÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ the currency before BritainÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢s vote to leave the European Union on Friday, and didnÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¾Ãƒâہ¡ÃƒÆ’‚¢t ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“speculate against sterling while he was arguing for Britain to remain,ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ a spokesman said in an e-mailed statement Monday. ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Â¦ÃƒƒÂ¢Ãƒ¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…âہ“Because of his generally bearish outlook on world markets,ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’â€Å¡Ãƒƒâہ¡ÃƒÆ’‚ Soros did profit from other investments, according to the statement.


best explanation I saw: it was an asymmetric trade.. No upside if Remain got up, but plenty of downside if Exit won. Which it did.


Yet very few 'experts' had played it this way (because they aren't experts).



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With both the current and capital account in play after the Brexit referendum, sterling is facing a particularly uncertain outlook ÃÆâ€â„¢ÃƒÆ’ƒâہ¡ÃƒÆ’‚¢ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â€š¬Ã…¡Ãƒâ€šÃ‚¬ÃƒÆ’…¡Ãƒâہ¡ÃƒÆ’‚¬ÃƒÆ’¢Ã¢Ã¢Ã¢Ã¢â‚¬Å¡Ã‚¬Ãƒâ€¦Ã‚¡ÃƒÆ’‚¬Ãƒâہ¡ÃƒÆ’‚ and especially as the Bank of England is not in a position to use higher interest rates to stabilize it," El-Erian told CNBC.



it's possible, but unlikely at current stage. but parity with euro is real possibility imho



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GBPUSD with a bounce this morning.. Any weakness around 1.342 Res. level would be a possible Short entry point if it does retrace that far.. I would still like a close of that 27th June gap but it seems out of reach. Will have to wait and see what direction it takes from here. There's a few pips in it if anyone is game to try and trade a long back to 1342.


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  • 2 months later...

In a sign of just how touchy currency markets are about the possibility of a 'hard' Brexit landing, the pound plunged more than 6 per cent within two minutes to a fresh 31-year low, and then recovered almost as quickly.


On Friday morning Sydney-time, French President Francois Holland spoke at a dinner and demanded tough negotiations on Britain's exit from the European Union, once news of his words got out, it sparked a sudden sell-off.


"When these things happen, typically the liquidity drains extremely quickly," said Martin Whetton, rates strategist at ANZ.


Against the US dollar, the pound plummeted 6.14 per cent to $US1.1841, the lowest since March 1985, and against the Australian dollar, it fell 7.09 per cent.


The Bank of England is "looking into" the causes of the crash, a spokesman said Friday. BOE Deputy Governor Ben Broadbent said earlier this week that the decline so far had been "relatively orderly."


Pound hasn't settled yet, says Mohamed El-Erian

Although the last leg in the pound's downward trajectory occurred suddenly and included a brief "flash crash" on Friday, the drivers of the decline have been long in the making, and the implications have yet to play out.


Here are seven things to know about the pound's present and future:


1. After holding relatively steadily around $US1.30 - following an initial steep drop caused by the surprise outcome of the June 23 Brexit referendum - the pound depreciated this week to around $US1.24. The process has been volatile, including the 2-minute flash crash, which took the currency to $US1.18 in Asian trading.


2. The immediate cause of the depreciation was the indication by Prime Minister Theresa May on October 5 that her government would favour a "hard" exit from the European Union. This dashed hopes, including mine, that calmer heads would prevail and that the UK and its trading partners would pursue a softer departure that maintains much of the free trade and financial arrangements


3. The free-floating currency's depreciation was a logical response, given the addition of such structural uncertainty to the trading relations of the UK, which was already running a current account deficit. After all, the UK has one of the more open economies, closely integrated with the rest of Europe on both the current and capital accounts of the balance of payments. Dismantling such long-standing links inevitably threatens trade and growth.


4. There are hopes that the depreciation will soften the contractionary blow to the economy - by encouraging exports, higher import-substitution production, larger tourist receipts and greater capital inflows. This is why the stock market is responding favourably - when measured in local currency - particularly the more outward-oriented index.


5. Relying on exchange-rate depreciation is not without risk. Some of the desired economic responses may be stymied, or at least delayed, by the unusual uncertainty facing the structural future of the UK economy. There will also be price pass-through effects that threaten higher inflation and complicate the Bank of England's policy management. And if a hard Brexit pushes the economy into recession, UK policy makers will be faced with one of the hardest challenges: navigating stagflation.


6. The political dimensions of the pound's depreciation are also worth monitoring. In the short term, they could include a renewed perception that financial developments are again favouring "international elites" at the expense of less fortunate segments of the population that have to deal with an inflationary threat. The positive responses of the stock market favour the better-off, who account for a disproportionate share of equity holdings. These developments are taking place even as the government is ramping up populist rhetoric in an effort to draw political support away from both the Labour Party and UKIP.


7. The rest of Europe should not take much comfort from any of this. The pound's depreciation will be yet another headwind for economies that are already coping with economic and financial challenges.


There is one simple conclusion: If both the UK government and its EU partners insist on a hard Brexit, the pound could be in for further volatility and weakness; and the impact on the rest of Europe will not be favourable.

by Mohamed A. El-Erian


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