GBP/USD Weekly Price Forecast – Sterling finds supportThe British pound fell initially during the week, reaching below the 1.30 level. However, we have turned around of form a bit of a hammer again, showing just how important this level is. I think that the 1.30 level will continue to be an area where value hunters are willing to step in, and at this point one has to wonder who is left to sell this thing?
The British pound has taken a bashing over the last several weeks, as the Brexit negotiations are not going very well. Compounding that, the British government can’t seem to decide on what to do so it makes sense that Sterling fell. However, it seems as if there is a significant amount of demand near the 1.30 level, and it is holding at rather true. Beyond that, Donald Trump suggested on Friday that he would try to convince the Federal Reserve to keep interest rates low, something that has roughly 0% chance of succeeding, but traders dumped the dollar anyway.
I think ultimately this market will go looking towards 1.43 level again, but you will need to be very patient if you are a buyer done at these low levels. However, if we were to break down below the 1.29 level, the market could drop to the 1.25 level given enough time. I like the idea of buying the British pound overall, especially on short-term dips. I think that it will probably be a short-term market for most of the next month, but I am certainly biased to the upside at this point and am starting to look at this as a “wave two” for Elliott Wave traders. I’m not an Elliott Wave traders, but I know a lot of people are. At this point, it’s just looking for an excuse to go higher.