GBP/USD forecast for the week of February 26, 2018, Technical Analysis

The British pound initially fell during the week, breaking below the 1.40 level, but we found plenty of support underneath, and bounced enough to form a nice-looking hammer. The hammer is a very bullish sign, and it looks as if the market is going to continue to bang against this significant resistance, and an area that the markets have been very noisy and, extending to somewhere near the 1.45 handle. Ultimately, I think that short-term pullbacks offer plenty of opportunities to pick up value, and I think that if we can finally break above the 1.45 handle, the market will continue to go much higher.

If we break down below the bottom of the hammer for the week, we will probably go hunting the 1.3650 level underneath, which has been resistance in the past. We also have the uptrend line that has kept this market higher, and I think it’s not until we break down below that uptrend line that I would be concerned about the overall uptrend. If we break the uptrend line on the weekly chart, then I would become aggressively short. Until then, I think that pullbacks are buying opportunities that you can take advantage of, and then eventually should build up enough momentum to continue the uptrend and send the GBP/USD pair much higher. I would anticipate that there is a lot of noise going forward, and I think that eventually we could go to the 1.50 level above.

GBP/USD Video 26.02.18