Goldman Sachs believes Pound might crash 20% on Brexit

Last week US investment bank, Goldman Sachs predicted Pound could suffer a drop of as much as 20% if Britons choose to leave European Union and go its own ways.

We, at FxWirePro, have written our opinions on that matter under a four part series named - "Brexit risks - justified or overestimated" and we also believe, Brexit or not, significant opportunity exists for traders in both the cases.

We don't have a number like Goldman, as our scenario is based on the upside as of now and we believe, Brexit is something that is unlikely to occur but just as we discussed in the series, if that is to happen Pound could fall and market hasn't totally priced in the risks arising from such event.

This month in summit, European leaders are likely to agree to the reforms demanded by British Prime Minister David Cameron, so if Britain still chooses to leave EU, then that would be a disaster at least in the near term.

From trading perspective,

We expect Pound to gain against Dollar in the near term to reach as high as 1.485-1.49 area, whereas drop against Yen to as low as 121 in the longer run.