GBP/USD Price Forecast – Pound Continues to Find Buyers On Dips

The British pound has fallen a bit during the trading session on Tuesday as we await some type of finality when it comes to the Brexit situation. It should also be noted that it is somewhat thin at the moment as we are in the midst of holiday trading. That being said, the market is likely to see erratic moves, but given enough time I do believe that we will have to make some type of decisive move as at the end of the year the United Kingdom loses the trade deal that was extended with the European Union, going back to the WTO rules. This could cause major issues with commerce, and a whole slew of other problems.

GBP/USD Video 22.12.20

The 50 day EMA underneath should offer support, and it should also be noted that every time we pull back it seems as if we buyers underneath, as denoted by the massive candlestick on Monday that was a complete turnaround. We got wind of Boris Johnson possibly bending a bit on the idea of fisheries during the trading session on Monday, and the British pound almost completely recovered its losses from the coronavirus concerns. That being said, moves will be exaggerated due to the lack of volume and therefore you should be very cautious about your trading position.

To the upside, if we break above the 1.35 handle, then it is likely that the market is to continue to go towards the 1.36 level, possibly even higher at that point in time. I have no interest in shorting the British pound at the moment, but this could change if we end up with a “no deal Brexit.”

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