GBP/USD forecast for the week of August 14, 2017, Technical Analysis

The British pound fell during most of the week, but continues to find support just above the 1.2950 level. That’s an area that seems to bring in a lot of support, and I think if we can rake above the weekly candle, we could make another attempt at the 1.32 handle. However, a breakdown below the bottom of the weekly candle could send this market lower, perhaps looking towards the 1.2850 level. The next couple of weeks could be important for the British pound, as we will substantiate whether the breakout was real or not. Ultimately, this could be an excellent selling opportunity if the British pound does tend to roll over, as we have rallied so much that one would think sellers would be willing to step in and take their profit from previous long positions.

Waiting for the move

I will be waiting for a daily candle to close either above or below the weekly candle from this past week to make my next trade. If we go higher, I think the 1.32 level will probably be massively resistive, and a break above there would in fact be very significant. Alternately, if we break down below the 1.2850 level, the market probably drops the 1.25 handle rather quickly. That would also signify that we are going to go much lower than that over the longer term from what I can discern in this market. There is a lot of concern around the world, as the United States and North Korea continue to argue. If that’s the case, it’s likely that the markets will continue to be volatile and begin a “risk on/risk off” type of scenario. Quite often, traders will look for the US dollar for safety in the situations.

GBP/USD Video 14.8.17