GBP/USD Price Forecast – British Pound Continues Sideways Struggle

The British pound initially tried to rally during the trading session on Monday but did give back some of the gains as we slosh around sideways in a market that quite frankly has nowhere to be. This is the worst time of year for trading, as a lot of the big players will be away at holiday. With that being said, we also are a little bit overextended, so it is not a huge surprise that we need to consolidate to digest some of the recent gains. The 1.30 level underneath it looks to be offering support, while the 1.3150 level above seems to be resistive.

GBP/USD Video 18.08.20

With all that in mind, I do not have any interest in shorting this pair, rather I recognize that a move down below the 1.30 level could kick off more buying opportunity close to the 1.2750 level and the 50 day EMA. On the other hand, if we can break above the 1.3150 level that would send traders into this market hand over fist in order to take advantage of what is clearly a trend trying to change to the upside longer term.

With that in mind, I like buying dips, and I most certainly like buying breakout. I have no designs on shorting this market anytime soon, as I do recognize that it is more likely than not to continue going higher, especially as the Federal Reserve continues loosen monetary policy. Longer-term, I anticipate that this market will probably go looking towards 1.35 level, but it may be several weeks before we make the breakout if liquidity does not pick up.

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