Brexit blues and OPEC production cuts
Theresa May has this week to persuade the UK Parliament that they should back her Brexit deal. One key area May is going to be focusing on is that of uncertainty. May has been saying that the British people want/need certainty so that they are not on 'pause mode' while these Brexit negotiations play out. The UK Services PMI data out on Wednesday could prove a key influence in on voters decisions. A weak Services PMI reading may give May more weight in her argument that Britain just needs to 'get on and leave with a stable agreement', so that Briatin can get back to 'normal' and avoid the uncertainty we have hitherto been experiencing in the UK.
However, May's optimism has been counter to the expectations of how people will vote. She is also now facing fresh criticism over her reluctance to make her legal Brexit advice public knowledge. The suspicion is that May has 'something to hide'. This piece from BBC's political editor, Laura Kuenssberg, suggests that May's support is actually shrinking. This came on the back of Science and Universities minister Sam Gyimah quitting after May said the UK was pulling out of the EU's Galileo satellite-satellite-navigation system arrangement. The Uk had wanted to stay part of it and Gyimah said that it shows the UK will be 'hammered' in future EU negotiations. This is a worrying sign for May.
So, I can only see more pain for the GBP ahead. I like a GBP/CAD short , as OPEC's meeting on December 6 is likely to be an annoucement of more production cuts (bullish Cad, bearish GBP/CAD). Risk can be limited above the 100 EMA on the daily chart and 1.6600 would be on the cards if May's Brexit deal get's voted down in the first instance.
