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Christopher Lewis
GBP/USD daily chart, February 18, 2019

The British pound initially pulled back during the trading session on Friday but found enough support at the previous downtrend line to turn around. We are also near the 50% Fibonacci retracement level so it makes a lot of sense that there would be interested in this area. However, I think that there is still a lot of concerns out there when it comes to geopolitical action and of course most importantly in this case the Brexit. Headlines continue to push it around, but I do think that the British pound has been rather resilient considering everything that’s going on. With that in mind, I believe that we have already seen the bottom of this currency pair, and therefore I continue to look for value when it comes to the pair.

GBP/USD Video 18.02.19

Even if we break down below here, I anticipate that the 1.27 level will offer significant support, so given enough time I do anticipate that the buyers return, if not only because of the round number, but perhaps even the 61.8% Fibonacci retracement underneath there. It’s not that the British pound can’t fall from here, it’s just that it has a lot of things working against that happening for any sustainable move. With that, I remain optimistic, but I also recognize that it’s going to be a very noisy ride to the top floor, so be prepared for that and keep your trading positions somewhat small, only adding as the market works out in your favor.

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