What is the Scottish referendum, and how is it affecting the pound?

Unless you have been living on another planet for the last few weeks, you will no doubt be aware of the fact that on the 18th September the people of Scotland will vote on whether Scotland should be an independent country or not.

A poll released last weekend saw the majority of voters voting for independence, which caused uncertainty in the pound, and saw a huge gap on Cable at the open on Sunday night.

Cable continued to sell off on Monday, but recovered for the rest of the week as various polls saw a change in sentiment giving the no vote the lead.

Cable is very close to closing the Sunday night gap now, but with more news flow leading up to the vote, we will be in for a pretty volatile week for the pound. So keep your stops tight if you are trading cable this week, and prepare to be in for a bumpy ride.

So what does independence mean for the people of Scotland? If you have ever watched the film Braveheart with Mel Gibson (which is a really great film) you will be aware of how passionate some Scottish people are about independence, and many wars have been fought between England and Scotland over it. So its pretty ironic when so many people have fought and died, that it now comes down to a simple vote, to decide the future of bonny Scotland.

Who is the man behind the campaign?

Alex Salmond is on the verge of doing what William Wallace failed to do, and give some Scottish people what they have waited for, for over 300 years, but can the man sometimes mistaken for a fish, really pull off the biggest victory in the history of Scotland. Some say he can, i say he cant.

I personally think that when push comes to shove the vote will be no, as i believe the people of Scotland however patriotic, have too much to lose by becoming an independent country, and they know that deep down in their brave hearts.

Alex Salmond is one tough cookie, and he has battled his way over many years to get to this point, and he has to be commended for that. But the day of judgement is nigh for Alex, and his political career is on the line on Thursday in this make or break vote.

Will he get the vote he so desperately needs, or will it be another Neil Kinnock moment, when victory was snatched away from the Welshman at the final hurdle, and handed to John Major, crushing Neil Kinnock’s dreams of becoming prime minister.

I feel that Alex will suffer the same fate on Thursday, and his dreams of becoming leader of an independent Scotland, and getting is hands on our oil will be left in tatters, as the people of Scotland will vote with their heads and not their hearts, and vote no to independence, and Scotland will stay a part of Great Britain, even if it is not so great anymore.

But staying part of Britain will surely be a better option than risking financial ruin, as British businesses have vowed take all their money and jobs out of Scotland, which will leave Scotland as the poor man of Europe. So a no vote has to be the only option in my opinion.

We can expect more volatility on the pound this week leading up to vote. A yes vote would see a huge sell off in Cable because of the uncertainty, and a no vote would see a large move up. I personally will be looking to add long positions on any major weakness in the pound, as i believe the vote will be no, and a stronger pound will be the result of that vote.

I would like to wish Alex and the people of Scotland good luck on Thursday, and i hope that whatever the outcome of the vote, it will be the right decision for the future of Scotland.