GBP/USD Price Forecast – British pound sideways on Tuesday

The British pound went back and forth against the US dollar during trading on Tuesday, as we continue to bounce around. It makes sense of the Brexit of course steals all the headlines but at the end of the day we also have to worry about global trade. If the global trade situation gets worse, US treasuries tend to outperform. If that’s going to be the case that obviously the US dollar will as well as it takes US dollars to buy those notes.

GBP/USD Video 29.05.19

Currently, I see the 1.25 level as major support and more than likely a target from the short seller perspective. Above, I see the 1.28 level as being significant resistance that would need to be broken for the buyers to make a serious move. Until that happens, I do favor the downside but it must be said that the action on Tuesday was somewhat encouraging from a buyer’s standpoint.

Longer-term, I still believe that the British pound will be thought of as cheap in this area, and the worst of the selling is done. After all, it can’t be a surprise that the Brexit is going poorly anymore, so I think that the downside is somewhat limited although preferred for short-term offense. If we break down below the 1.25 level, things could get rather ugly but right now I don’t see that happening anytime soon. We are heading into the summer so things could get quiet and range ground.

Please let us know what you think in the comments below