The British pound has fallen during most of the week but turned around on Friday to show signs of life again. That’s a very good sign, considering that it is right at a downward trend line, which of course is exactly where you want to see buyers jump in. At this point, I think that the market is trying to find a reason to rally, and with a softening Federal Reserve, it makes sense that the US dollar would fall. That helps the British pound in general, but we need good news out of the UK to confirm everything.
GBP/USD Video 11.02.19
As soon as we get some type of positive momentum when it comes to the Brexit deal, the British pound is going to shoot straight up in the air. I think at this point a lot of “smart money” is starting to dip their toes into the British pound, anticipating a major move. After all, by the time the news comes out on something like this, the impulsive move is already over. That doesn’t mean that the trend will continue higher, because quite frankly I think it will. That being the case, I suspect that buying in little bits and pieces as long as we can stay above this general region will probably be the best way to start buying, and I think that the 1.27 level underneath is massive support as well. Ultimately, I do think that we go looking towards the 1.33 level, but it may take some time to get there.
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This article was originally posted on FX Empire
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