GBP/USD Price Forecast – British pound hanging in there

The British pound fell initially during the trading session on Wednesday, but found enough support near the 1.26 level to bounce a bit and show signs of life again. However, I think there is plenty resistance above the 1.27 level and most certainly the 1.28 level to keep the British pound a bit soft. After all, we are just a few days away from the Brexit party winning massive amounts of seats in the European Parliament. This is a clear signal to Westminster that they need to get out of the European Union.

GBP/USD Video 30.05.19

The question now is who becomes the next prime minister. It’s very possible it might be Boris Johnson, and it’s very possible he may simply “run out the clock” meaning that we will get a hard Brexit on October 31. This course will weigh upon the British pound, but I do believe that eventually we will look at this as “the trade of the decade” when you bought British pound closer to the 1.25 or maybe even the 1.20 level. Longer-term thinking traders are certainly looking at this market as one that is offering extreme value.

In the short term, I believe we simply bounce around between 1.25 and 1.27, maybe 1.28. I would employ range bound systems but I would cut my positions in half to the upside if you did want to play of the way. Otherwise, you just simply sell rallies and show signs of exhaustion as it is the safer way to play.

Please let us know what you think in the comments below