A second UK property fund stopped redemptions, with Aviva Investments earlier halting retail investors from cutting out of its UK Property Trust, citing “extraordinary market circumstances.” This follows the lead of Standard Life, which yesterday blocked retail investor redemptions from its commercial property fund. Both funds said they lack liquid holdings to cover withdrawal demands. The fear is that more will follow, and that these funds will in turn be forced to sell property. Welcome to post-Brexit Britain. BoE Governor Carney earlier said that the central bank has “a clear plan” to keep the banking system operating and that the central bank is “rapidly putting its main elements into place,” emphatically adding that “it is working.” Carney conceded that the BoE will not “fully and immediately” be able to offset market and economic volatility..
Sterling continues to weaken: cable breaches 1.3100 (losing 1.5% today and recording new 31 year lows) and EURGBP breaks 0.8500 gaining 1.7%. The heaviest fall, as the markets move to significant risk off thanks to continued Brexit uncertainty, is GBPJPY losing over 2.3% today.
GBPJPY can trade lower still from these levels (134.00), the next Support is at 131.50, 128.50 and 125.60. However, as we move lower these targets become more difficult to achieve. Momentum is to the downside and although technically oversold, never underestimate the power of fear and greed.
Always trade with strict risk management and remember that your capital is your single most important financial trading asset.
Chief Market Analyst
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About Janne Muta, HotForex’s Chief Market Analyst
Janne Muta is a seasoned industry professional with over 16 years experience in the global markets. Originally from Finland, Janne has worked for institutions in both Helsinki and London as an institutional fund manager, global market analyst and FX educator.
Traders and fund managers from around the world have benefited greatly from Janne’s technical analysis methods. The indicators and price action based trading models he has developed, have, after rigorous testing, proven to be invaluable in identifying high probability trades.
“My mission is to help you to become a confident and successful trader”
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