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British pound falls only to recover a bit on Friday

Christopher Lewis

The British pound fell a bit during the trading session on Friday, reaching towards the 1.3350 level, an area that has been important in the past. The market looks very likely to see a bit of a bounce from here, and as I record this video we have in fact seen the last hour show buyers jump in. I think that eventually we could go higher, perhaps reaching to a fresh, new high and reach towards the 1.35 level, followed by the 1.3650 level after that. Remember, this pair is somewhat risk sensitive, and the talk of trade wars will of course have an influence as well, as that tends to send money into US treasuries, providing a natural need for US dollars.

The market participants will continue to pay attention to the negotiations between the European Union and the United Kingdom, because that of course will have a lot of effect on what happens with the British pound overall. Longer-term though, when I look at the weekly chart you can see that there is a significant amount of support just below, so I’m looking for an opportunity to go long, but I also recognize that it is going to be very noisy, so you should not have a lot of leverage on any buying opportunity that you take. Overall, be cautious but I think it’s only a matter time before the buyers take control, at least for the short term.

GBP/USD Video 11.06.18

This article was originally posted on FX Empire