GBP/USD Price Forecast – British pound falls to test support on Tuesday

The British pound fell a bit during the trading session on Tuesday, reaching down towards the 1.32 level. That is an area that should continue to be important, so the fact that we held above there is a bullish sign. If we were to break down below the 1.32 level, I think the market could drop down to the 1.31 handle. However, I believe that the market should continue to be supported underneath, and I think that the weekly charts should be looked at for guidance. We had formed a nice looking hammer on the weekly chart, which of course shows that we are starting to find serious support.

I think at this point; the 1.3450 level should continue to be very resistive. If the market were to break above there, then I think the next obvious target would be the 1.35 handle, followed by the 1.3750 level, and could be attained over the longer-term as the Bank of England has recently changed its overall attitude and was a bit more hawkish during the last statement than anticipated.

Expect plenty of volatility, but if you are cautious enough, or at least can take a longer-term outlook, you may be able to take advantage of the massive implications of the levels underneath. If we do break down below the surge from last week, we will almost certainly open the door to the 1.30 level afterwards, an area that is obviously psychologically important.

GBP/USD Video 27.06.18