GBP/USD Price Forecast – British pound pulls back on Friday

The British pound pulled back a little bit during the trading session on Friday, but only mildly so. After forming a hammer during the Thursday session, showing signs of support at the 200 day EMA, I do believe that we continue to go higher but we are starting to get a bit stretched, and of course there seems to be a lot of noise just above overall. I think that pullbacks will be looked at as possible buying opportunities, especially if we get closer to the bottom of the candle stick from the Thursday session.

GBP/USD Video 28.01.19

The 200 day EMA also offers plenty of support psychologically as well as algorithmically, as a lot of systems look at that as a major support level and trend setting moving average. If we were to break down below there, then I think we would reset closer to the 1.2850 level. Overall, I think that we are probably going to continue to go higher, perhaps reaching towards the 1.3250 level above as it is the scene of massive resistance. After that, I would anticipate that this market would go to the 1.35 handle, which may take some time to get to. Remember, this is about the Brexit being delayed, so there are going to be headline issues out there that could move the pound rather violently. With that in mind, look to pick up bits and pieces on pullbacks that offer value for the longer-term move. I would not jump in with huge positions at this point.