GBP/USD Weekly Price Forecast – British pound rallies for the week

The British pound rallied during the week, reaching towards the 1.34 handle before pulling back a bit. However, I do believe that we are in the process of consolidating, perhaps trying to build up enough momentum to break out to the upside and continue the longer-term move higher. My next target is 1.35, but we need to clear the 1.3350 level to make that move. In the meantime, I like buying pullbacks as they offer value.

GBP/USD Video 18.03.19

The Federal Reserve has stepped away from the idea of tightening monetary policy, so that helps this market as well. If the Europeans agreed to extend the Brexit deadline, that should be the next catalyst for buying of this currency. Quite frankly, the market has recently broken through a major downtrend line and gone sideways which is quite common before you see the surge higher. The trend is changing but that never happens overnight. Being patient and taking advantage of value when it appears will continue to be the best way to trade this market, and I anticipate that later this year we are probably looking at a level closer to the 1.40 level once we get a bit of clarity.

To the downside I see the 1.30 level as being very supportive, as the buyers have shown up there a couple of different times now. Ultimately, it’s not until we break down below the 1.27 level that I would be concerned about Sterling and begin to think about the possibility of shorting.

Please let us know what you think in the comments below