GBP/USD Price Forecast – British pound explodes to the upside after German softened stance

The British pound has exploded to the upside in reaction to word getting out that the United Kingdom and Germany may be softening their stance on some of the most hardline issues of the Brexit. If that’s the case, then we are much closer to a Brexit than originally thought. However, we seem to move like this just last week, so be a bit cautious about jumping in with both feet. Unfortunately, far too many retail traders are probably betting their entire account on this move. They will be sorely mistaken to do so, because until we get confirmation, there is the possibility that a tweet or some other type of statement will come out to smack this right back down. However, I do think that we are getting close to a trend change in the British pound, and that will almost certainly come once we break above the downtrend line near the 1.3033 level.

This is a tricky candle to trade, and quite frankly the best way to trade something like this is the buy on short-term dips. If we get there is, then those should be thought of as value, but cautiously so. I would build a long-term position in little bits and pieces, and once we break above the downtrend line, then it becomes a “buy-and-hold” situation.

GBP/USD Video 06.09.18