The British pound has gapped higher to kick off the week, as the risk appetite of traders was helped due to comments coming out China, which seem to have been reversed, so now it’s obvious that the risk appetite would fail. This makes sense that the 1.30 level would continue to cause issues for the British pound, as it has been so resistive in the recent past. That being the case, it’s very likely that the market will continue to be erratic and well supported underneath though, as we are trying to form a bit of a bullish flag. This action has done nothing to negate that, and if we were to break above the 1.30 level, it would kick off a bigger move.
GBP/USD Video 19.11.19
Based upon the bullish flag, the market could very well go as high as the 1.38 level, but it looks to me as if there is a lot of noise near the 1.33 handle as well. Because of this, even if we do kick off the bullish flag it’s very unlikely that the market simply rips to the upside. Short-term pullbacks between now and then should be a buying opportunity, but a certain amount of patient trading will be crucial to make this market possible more than anything else. Ultimately, this is a market that does break out given enough time, especially once we get the election’s out-of-the-way in the United Kingdom. In the meantime, it looks as if people are accumulating more British pounds.
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This article was originally posted on FX Empire
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