GBP/USD Price Forecast – British pound breaks down after Brexit Noyes

The British pound broke down again during the trading session on Tuesday after it has been leaked that Angela Merkel suggested that Northern Ireland must remain in the customs union. Obviously, this is a nonstarter for Boris Johnson.
Christopher Lewis
GBP/USD daily chart, October 09, 2019

Well, it’s been about 20 minutes so we have more Brexit nonsense. Because of this, the fact that Northern Ireland is asked to stay in the customs union is a bit of a nonstarter for the British, and this of course has people selling the Pound. That being said, we are sitting at the 1.22 level as a write this article, an area that is the bottom of the overall consolidation. If we were to break down below the 1.22 handle, that could open the door to the 1.20 level given enough time.

GBP/USD Video 09.10.19

Alternately, the market could find its footing and bounce from here and reach towards the 50 day EMA. With that being the case, it would simply be more of the same. At this point in time, the market is most certainly in a longer-term downtrend, but has certainly been very erratic over the last couple of months. I do believe that the 1.20 level will be massive support from either structural or psychological pressure, and I also believe that we are closer to the bottom in the British pound and we are the top. Yes, we will eventually get some type of final result when it comes the Brexit, and it could be very negative for the Pound. However, after that “flush lower”, I’ll be looking to buy the British pound for a longer-term “buy-and-hold” scenario as once we get a little bit of certainty in the market, regardless of what that certainty is, that almost certainly will provide a nice opportunity.

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