GBP/USD Price Forecast – British pound rallies again

The British pound rallied again during the day on Wednesday, showing signs of life as we reach towards the 1.31 handle. At this point, we are reaching an area where there was pretty significant selling in the past, so the next couple of days will be crucial. We have a lot of political noise when it comes to the British pound, and there’s even delusions about a potential second referendum. If that’s the case, it may initially be good for the British pound but ultimately the civil unrest alone will probably work against it.

GBP/USD Video 02.05.19

It is because of this that I would anticipate that we will have selling sooner or later, but if we break above the 1.31 level we have to start looking for sellers at higher levels. Clearly, if you are going to buy based upon the rumors and innuendo, you would need to have been involved already. You have simply missed that move. That doesn’t mean it can’t continue to go higher, but at this point it’s somewhat living on borrowed time.

A break above the 1.31 level opens the possibility of 1.32, and then possibly even 1.34. That of course would change the entire look of this pair and have me reevaluating the situation. At this point, it’s probably best to wait and see what the 1.31 level brings us, as I’ve been thinking for some time. To the downside we could be looking at a move to the lows again, and then eventually the 1.28 level on a failure of 1.31 above.

Please let us know what you think in the comments below