GBP/USD Price Forecast – British pound continues to drift sideways

The British pound has tried to rally early during Monday trading, but as you can see we remained somewhat sideways around the 1.28 handle, an area that is supported by the 61.8% Fibonacci retracement level and of course the previous downtrend line that has offered support on the way down. Ultimately, I think that this market continues to see a lot of volatility down at this lower level, but I think that we will need to make some type of decision in this area. If we were to break down below the 1.2750 level, then the market would break down even further. I suspect that we are so oversold that it’s only a matter of time before the market rallies again.

GBP/USD Video 30.10.18

If we can get some good news about the Brexit, obviously that will be a major influence as to where we go next, but I think the market is a bit exhausted to the downside right now, and the longer-term “buy-and-hold” scenario could play out at these low levels. If we do break down below the 1.2750 level, I anticipate that the 1.25 level would probably be targeted next. Expect a lot of noise, but quite frankly that’s nothing new with this pair over the last several months. We are at extremes, and that’s typically when value hunters come back into play. At this point, I’m willing to take a small long position with the keyword being “small” as we need to be careful.