GBP/USD Price Forecast – British Pound Pulls Back

The British pound pulled back a bit during the trading session on Thursday as traders took profits after a massive move higher. The market has been a bit overextended for the last couple of days so this should not be a huge surprise. Having said that, the market is still very much enjoying a lot of value hunting out there, and I would have to believe that sooner or later we will find buyers underneath. The question now is whether or not they choose to defend the 1.31 level, or is it going to be the 1.30 handle?

GBP/USD Video 13.11.20

I prefer buying near the 1.30 level because there are a couple of different things working for at that price. The first thing of course is the fact that it is a large, round, psychologically significant figure, and then of course we also have the 50 day EMA sitting right at that level as well. That being the case, I think that you should also keep in mind that there is a short-term uptrend line in that same general vicinity as well, so I think there are plenty of reasons that there should be buyers looking to pick up a bit of value.

Furthermore, we also have the Brexit situation out there, so things could change very rapidly. That being said, it is likely that we will see some type of headline that gets people excited. In the short term, it is more of a “risk off” type of situation and that of course favors the US dollar in general. With this, I believe that if you are simply best sitting on the sidelines and waiting for some type of value showing itself in the form of a supportive daily candlestick.

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