GBP/USD Weekly Price Forecast – British pound shows signs of support

The British pound has showed signs of life during the week, initially dipping below the 1.25 level, but then bounced enough to form a hammer. The hammer of course is a bullish sign and suggests that we are simply going to go back and forth. Ultimately, if we do break above the top of the candle stick it’s likely that we could go looking towards the top of the recent consolidation area which is at the 1.2750 region.

GBP/USD Video 15.07.19

On the other side of the trade, if we were to break down below the candle stick for the week, then the market probably flushes much lower, reaching towards the 1.20 region. Overall, this is a market that is trying to find a bottom, but we have a lot of concerns when it comes to the Brexit. Ultimately, the Brexit will cause the occasional headline, but we also have the Federal Reserve looking to cut interest rates so there may be a repricing of the currency pair. Ultimately, this is a market that will have a lot of factors going back and forth, so I think at this point the one thing you can count on is choppiness.

However, we have a couple of simple and easy set ups, so by that we know where were going to go next. Ultimately, the market is historically cheap so a break above the top of the hammer of course makes sense for a nice trade. However, if we do flush below this market could unwind rather quickly. It would be an extraordinarily negative sign for the Pound.

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