GBP/USD Weekly Price Forecast: British Pound Continues Upward Momentum

The British pound initially pulled back during the course of the week only to shoot higher and reach towards the 1.34 level. That is the beginning of significant resistance that extends to the 1.35 handle, so I do think that a pullback is probably do, but that pullback will more than likely be bought into as we have seen time and time again that the British pound offers plenty of resiliency. At this point in time, the market is likely to see plenty of buyers underneath and eventually they will push to the upside. Ultimately, if the market breaks above the 1.35 handle, then it kicks off the next leg higher.

GBP/USD Video 30.11.20

Once we get some type of certainty out of the Brexit situation, then we can move higher. Until then, it is going to be simply trading on the latest headline, be it good or bad. Obviously though, the British pound is still historically cheap, so at their slightest hint of normalcy in the United Kingdom, one would have to think that the British pound would go much higher over the longer term. This is not to say that it would do it in a straight line but clearly once the certainty comes into the market a lot of people will be much more comfortable owning it.

If we do not get some type of deal involving the Brexit, that would be absolutely catastrophic for the currency. Between now and then, markets will be nervous, but it certainly looks as if they are optimistic more than anything else.

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