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Christopher Lewis
GBP/USD daily chart, February 22, 2019

The British pound has rallied a bit during the trading session on Thursday, going back and forth to form a slightly positive candle stick, but still showing quite a bit of resistance above at the 1.31 handle. That’s not a huge surprise, because we may have got a little bit ahead of ourselves in the last couple of days. Pullbacks at this point are likely but I also believe that that pullback might be a nice buying opportunity.

GBP/USD Video 22.02.19

Looking at this chart, I believe that the 1.29 level underneath offer support based upon the gap higher at the beginning of the week, and of course the bottom of the massive candle stick from the Tuesday session. If you see this market pull back there, you could see quite a bit of support as well, based upon not only the 50% Fibonacci retracement level, but also the downtrend line that offered support.

To the upside, I believe that the market is probably going to go looking towards the 1.32 handle, an area that cause quite a bit of resistance above. If we can break above there, then the market probably search looking towards 1.33 handle. I do believe that the British pound has bottomed overall, as we are getting closer to the endgame of the Brexit, quite often traders will start looking for value. Clearly, on the longer-term chart the British pound is offering value as we are at extraordinarily low levels. That doesn’t mean it’s going to be easy, but it does suggest that perhaps we are going to see volatility that offers a “by on the dips” attitude.

Please let us know what you think in the comments below

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