GBP/USD Weekly Price Forecast – British pound pulls back to support

The British pound has pulled back against the US dollar during the week, reaching down to the 1.30 level before finding a little bit of support. We have received good economic numbers out of the United Kingdom, and that of course should be good for the British pound, but at the same time were worried about the US/China trade talks. That has held the entire market hostage, and this of course won’t be any different. But frankly, people are worried that we could get bad news out of the trade talks, and if we do that probably sends money flooding into the US dollar as treasuries will be bought.

GBP/USD Video 13.05.19

However, if we get good news out of those talks it’s very likely that this pair will rally because then we can start to focus on the strengthening British economy. One thing is for sure, it’s going to be very volatile and very difficult to deal with in the meantime.

Longer-term I do believe that we should be looking for value in this pair, and that we are at historically cheap levels. However, the volatility is going to be extraordinary over the next couple of days, and then at this point you should probably keep your position size relatively small. However, I do look for dips in this pair to add to a larger core position for when the British pound turns around, it should be a long term run to the upside, all we need is a bit of certainty out of the Brexit.

Please let us know what you think in the comments below