In 2016, the United Kingdom voted to exit the European Union. Two years later, the country is more divided about how to exit the union. The government under Theresa May published a white paper on her vision for Brexit. The paper outlined that the UK will continue having a close relationship with the EU after exiting the union.
To many Brexit supporters, the new stand by the government is a betrayal to the spirit of the Brexit. This is because by remaining in the customs union, the country will be under the authority of the European Union. This will make it a bit difficult to make deals with other countries. Most importantly, it will prevent the US from making a deal with the UK.
This point was reaffirmed yesterday when Donald Trump delivered an interview with The Sun. In the interview, he said that the US will have a major challenge doing the deal with the EU. He also praised Boris Johnson, one of the leading Brexit voices and former foreign affairs secretary. Boris is seen by many as a key successor of Theresa May.
Trump has never been a fan of the European Union, which is known for its bureaucracy. In a recent interview, he said that the EU was formed to compete with the United States.
As a result, the pound has taken a beating against the dollar and fell to 1.3177, which is the lowest level since 4th of July. During the Trump’s visit, the pair is likely to continue being volatile. This could see it test the important support of 1.3100. The current price is near the lower band of the Bollinger Bands with the RSI at 37 and pointed lower. This is a further proof that the pair could see some more downside movements today.