GBP/USD Weekly Price Forecast – British pound slams into previous downtrend line

The British pound has broken down significantly during the week, reaching towards the 1.28 handle. The 1.2750 level underneath is a massive support level, so if we were to break down below that level, it’s very likely that the British pound would unwind. However, when you look at the chart, you can see that the downtrend line most certainly is important and breaking through that downtrend line and coming back to test it for support is going to be crucial. Because of this, I believe the next couple of weeks will determine what happens next from a longer-term standpoint in this market. As for the British pound this week, I would be very cautious about trying to put too much into the market right now, as it certainly has been extraordinarily volatile.

If we do bounce from here, I think there is a major amount of resistance at the 1.30 level, and of course is pair will continue to be very sensitive to headlines involving the Brexit and risk appetite. At this point, the British pound probably is a bit oversold, so this support could hold. However, I would wait for at least one positive day before putting money to work from a longer-term standpoint and recognize that quite often you get a sideways market after a downtrend has stopped. He will be very interesting to see how the next week or so plays out, because I think we are at a major inflection point. If there’s any hope for the buyers to push to the upside, it’s right here.

GBP/USD Video 29.10.18