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The British pound initially rallies on Friday, but gives back significant gains

Christopher Lewis

The British pound rallied during the day on Friday initially, reaching towards the 1.43 level, an area that has been resistance in the past. I think that the market should continue to try to break above there, but it will take several attempts. The 1.42 level underneath should be support, and I think that the buyers will continue to look at this market as one that gives opportunity one of pulls back. The British pound has been one of the better performers against most currencies in the Forex world, and I think it will be any different against the US dollar.

If we do break above the 1.43 level, the market should then go to the 1.45 handle. That level is even more resistive, and I think that it will take several attempts to get above there as well. Ultimately, I think that the British pound will be one of the better performers this year, so I don’t have any interest in shorting. Value is the best way to play this market, and I think that it shows value every time we pull back. The current “floor” in the market is closer to the 1.40 level, so I don’t think that we will break down below there. If we did, that would change a lot of things, but it looks very unlikely at this point as the British pound has been so resilient.

GBP/USD Video 16.04.18

This article was originally posted on FX Empire