GBP/USD Price Forecast – British pound short covering ahead of vote

While the British pound is seen some short covering due to the upcoming vote on Teresa May, the reality is that even if she sticks around, there will be many issues ahead of us anyway so I think that the market will eventually sell off regardless. I would be looking to go short near the 1.27 handle, an area that has been previous support, and should now offer plenty of resistance. Because of this, be looking for opportunities to short this market near that level. I have no interest in trying to buy this market, at least not in the short term as we saw plenty of issues regardless of what happens next.

GBP/USD Video 13.12.18

Breaking below the descending triangle is of course a negative sign, and I think it shows that we are probably going lower anyway. The measured move from the descending triangle was to reach towards the 1.22 handle, although I think it will be very machine driven and of course erratic. Beyond that, a lot of major firms are starting to stay away from the British pound as it is almost impossible to trade on a day-to-day basis. We can be up 50 pips in the blink of an eye, mainly due to a headline on twitter that turns out to be false. This is what happens when machines take over markets, they failed to understand nuances when it comes to words, and therefore cause a lot of pain for traders in both directions. Overall though, we have lower to go.