GBP/USD Price Forecast – British pound tries to rally

The British pound try to rally during the trading session on Monday but gave back quite a bit of the gains to turn around and form a less than impressive candlestick. However, there is significant support just below as well.
Christopher Lewis
GBP/USD daily chart, June 04, 2019

The British pound rallied a bit during the trading session on Monday, but gave back the gains rather quickly, as we continue to see a lot of negativity when it comes to the British pound. After all, we have a lot of trouble when it comes to the Brexit, and as a result it’s very possible that we may see traders continue to short the British pound every time he gets the chance. On the other hand, if we could continue to rally we could go as high as 1.2725 handle, before finding quite a bit of resistance.

GBP/USD Video 04.06.19

I suspect that the best way to trade this market is to simply fade rallies as they appear, as there should be plenty of reasons to short this market in general. Quite frankly, it’s not until we break above the 1.28 handle that I would be comfortable buying, as it could send the market looking towards the 1.30 level above. That level should be massive resistance, so I would be surprised if we got above there, at least not without some type of good news involving the Brexit.

All things being equal, I fully anticipate that this market will probably go looking towards the 1.25 handle underneath. That’s an area that should be massive support, so I think that the market needs to test that area. If we break down below there, things could get rather ugly. One thing worth noting though is the fact that we had formed a couple of hammers over the last couple of days so I don’t think it’s going to be easy to break down.

Please let us know what you think in the comments below

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