GBP/USD Price Forecast – British Pound Pulled Back

The British pound initially tried to rally during the trading session on Friday, but then gave back the gains in order to fall apart and reach towards the 1.31 handle. This is an area that is support on short-term charts, and of course we have been in a longer term uptrend for some time. Ultimately, this is a market that continues to chop back and forth and therefore I think we will continue to see a lot of noisy and sideways trading. Looking at the chart, I also see a massive amount of support at the 1.30 level, so that is worth paying attention to as well. It is not until we break down below there that I would step to the sidelines and give up the idea of buying, at least in the short term.

GBP/USD Video 24.08.20

To the downside, the 1.2750 level is massive support as well, as it is the beginning of a run hundred point range of previous resistance. I do believe that the British pound eventually goes higher due to the fact that the Federal Reserve continues to flood the market with greenbacks, but I also anticipate that we will see a lot of noisy trading regardless, and therefore waiting for some type of pullback in order to pick up a bit of value might be the best way forward.

All things being equal, I do believe that we go looking towards the 1.35 handle, but we may have some work to do before we get there. Overall, I think that the Federal Reserve will do whatever it takes to kill the dollar, and so far, they are doing a pretty good job.

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