First Health Secretary Wes resigned and now Andy Burnham is eyeing the top job.
UK Prime Minister Kier Starmer’s cabinet is crumbling with a full-blown leadership challenge rapidly becoming a reality.
For GBPUSD this means one thing: extreme volatility
Note: GBPUSD has dropped over 150 pips since yesterday and expected to be the 3rd most volatile G10 in the week ahead.
Now here's the twist…
Right in the middle of all that political noise, GBPUSD just flashed a golden cross on the daily chart.
A classically bullish signal. Politics screaming one thing, technicals whispering another.
Nevertheless, a major move could be on the horizon and here are 4 reasons why.
Britain’s political crisis: The threat of a leadership contest is bad news for the UK economy which is already dealing with the fallout of the Middle East conflict. An extended period of political uncertainty may haunt investor attraction toward the British Pound.
UK data dump: High-impact data releases could provide key insight into how the economy fared in the face of geopolitical risk and surging energy prices. Much attention will be given to the CPI which may heavily influence how soon the BoE will hike interest rates in 2026.
Dollar volatility: A combination of ongoing geopolitical risk and US data could inject fresh volatility into the US dollar. A weaker dollar is bullish for the GBPUSD while a stronger dollar may drag the major currency pair lower.
Technical forces: The GBPUSD has secured a solid daily close below the 1.3450 support level. Bloomberg’s FX model shows a 76.2% probability that that prices trade within the 1.3239 – 1.3560 over the next one-week period.
