GBP/USD Higher After May's Speech

The Sterling took off after Theresa May's speech to pursue a hard Brexit and exit the common EU market. Traders and investors apparently believed in her words that a hard Brexit would be positive for the UK as the country expects to come out stronger than when they were a part of the EU. She emphasized that an exit from the EU is not an exit from Europe and would pursue to keep an open market between the UK and the EU.

All of this signaled a buy and the Sterling valued against all its competitors. GBP/USD reached a high of 1.2415 a few hours after the speech, up from 1.1985.

Currently, minor selling has occurred which is probably some profit-taking and the pair has devalued to 1.2270. The move, worth noting, was a reflection on May's outlook for the future and not actual facts so the retrace can be expected to continue.

Chart: GBP/USD H4