GBP/USD Weekly Price Forecast – British pound pulls backThe British pound pulled back against the US dollar during the week, as we continue to consolidate in what I see as a reasonably significant support level as I have marked on the chart.
The British pound rallied a bit against the US dollar to kick off the week but then fell again as we continue to worry about the Brexit. However, I do think that we will find plenty of support just above the 1.25 level based upon the fact that the market has shown itself to be interested in buying the British pound at that region previously. There’s no reason to think that market memory won’t come back into play, so keep that in mind.
GBP/USD Video 17.06.19
That being said, if we get some type of nonsense coming out of the Brexit, that could break this market down below the 1.25 handle. If it does, then we are probably looking at two or possibly even three handles to the downside. All things being equal though, I think the Federal Reserve stepping away from its hawkish attitude will continue to put a bit of a bid in this pair, especially considering that we already know the Brexit is a mess. Sooner or later, and I suspect it’s probably more sooner than later, there is the possibility that we form some type a bottom for a longer-term move.
That won’t be easy to accomplish, and quite frankly that’s normally a very messy affair. You can expect a lot of back and forth, you can expect a lot of whipsaw trading. This is why you need to keep your position size small on the bullish side, and simply add as you are proven correct. Quite frankly at this point it’s a bit of a coin toss, but I do think that support is very strong.
Please let us know what you think in the comments below