The British pound fell during the Friday session, reaching down towards the 151 handle, which looks to be offering a bit of support. I think that the market is going to make a significant decision rather soon, and a couple of levels could be important places to watch.
The British pound has gone back and forth during the trading session on Friday, testing the 151 level for support. I believe that there is even more support underneath that the 150 handle, and I think that the 150 level offers a hard “floor” in the market. If we were to break down below there, then the market will unwind rather significantly. However, as the Americans are taking over during the Friday session, it looks as if the markets are trying to find enough support to continue going higher. A break above the 151.75 level is a very bullish sign and should send this market looking towards the 153.50 level over the longer term. A break above that level should send this market towards the 155 handle.
The market of course is highly sensitive to the risk appetite of traders around the world, and this is normally dictated by stock markets, commodity markets, and of course bond markets. If traders around the world look likely to continue to pick up risk, that should help this market. I think that this pullback has offered a nice buying opportunity eventually, but we will need to see whether we are going to get to break out to the upside that would help me start putting money to work. Otherwise, I will “reset”, looking for a buying opportunity closer to the 150 handle, an area that will cause a lot of psychological support as anticipated.
Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.