GBP/USD Price Forecast – British Pound Get Hammered

The British pound broke down rather significantly during the trading session on Tuesday, reaching below the 1.3150 handle. This is a significant sell off, as Boris Johnson suggested that a no deal Brexit was still very possible. Having said that though, the market has plenty of support underneath and quite frankly it’s likely that the 1.30 level will attract a lot of attention anyway. Ultimately, this is a market that will be full of people who are trying to get involved in what has been an obvious uptrend. At this point, the 1.35 level has been a bit difficult to overcome, but at this point in time the knee-jerk reaction needed to be sold off, as the market got ahead of itself. If we can build up some type of base around the 1.30 area, and perhaps even the 1.31 handle, it’s very likely that we will then bounce towards the 1.35 handle again. The Brexit being somewhat more certain to happen gives this market a bit of a boost.

GBP/USD Video 18.12.19

The 1.30 level is the beginning of the bullish flag body that extends down to the 1.28 handle. The flag measured for a move to the 1.38 level and I don’t think that there is any reason to think that it won’t reach their given enough time. At this point I like the idea of buying pullbacks in the British pound, just as I have for several weeks now. This massive negative candle should give us enough value to get involved rather soon. I am waiting for some type of supportive daily candlestick to get long again.

Please let us know what you think in the comments below