GBP/USD Price Forecast – British Pound Trying to Recover

The British pound rallied during the trading session on Friday, as the 1.31 level is trying to offer a little bit of support, but at this point I would still be a little bit cautious about the idea of jumping in. After all, the British pound is going to be very volatile one you look at the Brexit situation not getting any more clarity. Furthermore, if we get some type of major “risk off move”, it could drive money into the US dollar. Finally, we have the worry about closing down the United Kingdom from an economic standpoint, so that does not help the situation either.

GBP/USD Video 16.11.20

All of that being said, I believe that the 50 day EMA sitting around the 1.30 level is a good sign of support, and of course we have seen a slight rise that would coincide with that general area anyway. That being the case, I like the idea of finding value on dips, but I would be very cautious about putting a lot of money to work. After all, this is a currency that is going to be highly supported by the idea of getting some positive reaction to the Brexit news, and given enough time they will probably try to figure something out, or at the very least get it over with and have a “no deal Brexit.” Either way as soon as we get clarity it is likely that the British pound will continue to rally due to the fact that we are at historically low levels. In the short term, I look it dips as potential buying opportunities but am very cautious.

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