GBP/USD Price Forecast – British Pound Continues To Bounce Around

The British pound has shown a significant amount of volatility over the last week or so, and the last couple of sessions have been completely counter to each other. This typically means that the market is trying to catch its breath and will probably consolidate overall. At this point, the market is likely to find a lot of back-and-forth, and it will of course continue to be very concerned about the Brexit. Obviously, the headlines will come fast and furiously over the next couple of weeks, so it’s difficult to get excited about this market for any significant amount of time.

GBP/USD Video 16.10.19

Ultimately, short-term back and forth range bound systems should continue to work for a short-term smash and grab type of trades, with the obvious ceiling being the last couple of days. If we were to break above the highs from the last couple of sessions, then the market probably goes looking towards the 1.28 level. Otherwise, we could break down towards the 1.25 level which of course is a large, round, psychologically significant figure, and it should also be noted that the 200 day EMA is slicing through the last couple of candles as well. Ultimately, this is a market that is trying to figure out what to do after the recent explosion higher, so that being said it makes quite a bit of sense that we will see a major “flush lower” if we break down below the 1.25 handle.

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