GBP/USD Price Forecast – British pound recovers on Thursday

The British pound has recovered during the day on Thursday, breaking above the 1.30 level by the time the Americans came to work. By clearing this level, and hopefully hanging onto the gains, this is a sign that the market is going to continue to rally from here. I believe that we continue to see a lot of value hunting in this market, and every time we pull back there seems to be more and more people willing to step in. While we don’t always make a “higher low”, that’s indicative of a trend that’s trying to change, and if you look at historical charts you can see this happen quite often.

I think at this point the British pound being so cheap has caught a lot of people’s imagination. I think the 1.3125 level above is probably where we are going to try to go, but I recognize we will have the occasional pullback. I look at those pullbacks as an invitation to pick up the British pound “on the cheap.” If we can break above the 1.3125 level, I think the market then goes much higher. I do believe that we are building the foundation for a longer-term uptrend, but it’s good to take some time to make this happen. The market has more than likely already priced in the fact that the Federal Reserve is going to raise interest rates three times. Because of this, all we need now is some type of agreement with the Brexit, even if it’s a no deal, then we can start to focus on the merits of the British pound by itself.

GBP/USD Video 05.10.18