GBP/USD Weekly Price Forecast – British pound has wild ride for the week

The British pound broke down rather significantly during the week, but then bounced a bit. However, what you don’t see on the weekly candle stick is that the Friday candlestick looks rather sickly. Because of this, I think that the break down during the week that a lot of technical damage that should continue to go in favor the sellers.
Christopher Lewis
GBP/USD weekly chart, January 07, 2019

The British pound has been very noisy during the week, breaking down below the 1.25 handle, and even formed a couple of very bearish looking candlesticks within the weekly candle stick that you are looking at. Because of this, I think what we will probably see is a ton of noise, but I think that the British pound will continue to see a lot of negativity due to the Brexit, and of course the lack of clarity when it comes to that situation. Beyond that, the jobs number in the United States was very strong and the Federal Reserve may still be looking to raise interest rates at least twice during 2019.

GBP/USD Video 07.01.19

If we can break down below the 1.25 level, then we should fulfill the descending triangle that measures for a move down to the 1.22 handle. I would not be surprised at all to see that happen, but it may take a while to get there as there will be a lot of conflicting headlines between now and the end of March when the United Kingdom will officially leave the European Union. I think there is a lot of volatility ahead of us, and volatility typically erodes confidence, which should continue to put bearish pressure on this market. Beyond that, US Treasuries continue to be bid, which drives up the value of the US dollar as well.

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