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Christopher Lewis
GBP/USD daily chart, July 24, 2018

The British pound has been choppy and sideways to open up the week on Monday, as we hover and churning gains just above the 1.31 level. There is a certain amount of resistance above near the 1.3160 level, so we have been range bound. If we can break above that level, then I think the market will probably go looking towards 1.3235 handle, an area where we had seen a lot of supply in the market. In the short term, I believe that there is a certain amount of demand closer to the 1.31 handle, so I would suspect that the market is probably trying to figure out where to go next. There’s a lot of noise out of the UK when it comes to Brexit and Teresa May, and that of course shows up in the charts here.

All things being equal, the market is at the very least digesting the recent gains. We had a very impulsive move during the Thursday session, and now it looks as if we are trying to figure out whether the market can keep up the momentum to break out to the upside. I suspect that there are plenty of headline risks coming out of the United Kingdom, so I am more apt to sell rallies on signs of weakness than anything else from a longer-term standpoint. Short-term traders will be going back and forth in the range that we have carved out during the day on Monday, as it shows definite support and resistance.

GBP/USD Video 24.07.18

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