The British pound has tried to rally during the week, but it gave back quite a bit of the gains in order to form a very ugly candlestick. At this point, the market looks as if it is going to continue to be a “bait the rallies” type of scenario, but you might be better off doing that on shorter time frames such as the daily candlestick chart, or even the four hour candlestick chart. However, if we break down below the bottom of the candlestick for the week, that could send this market much lower, reaching down towards the 1.20 level. Either way, there is not much on this chart that tells me that we should be buying at this point.
GBP/USD Video 29.06.20
The United Kingdom did open up its economy, to a point, and that has helped a bit but at this point it looks like it is going to be terribly slow and difficult, and baryon even to say the least. With that in mind, I think that we are looking at a scenario where we are trying to form a bit of a rising wedge as well, which of course is a negative pattern. With all of the potential issues out there when it comes to Brexit and a whole host of other geopolitical problems, I believe that the US dollar is going to continue to get a bit of a bid. Whether or not we break down is a completely different story, but right now it looks like those rallies continue to be shunned.
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This article was originally posted on FX Empire
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