The British pound has rallied a bit during the trading session on Tuesday, reaching towards the 1.30 level early during the day. However, that is an area that is rather strong for its importance and psychological impact, so it’s interesting to see that the market has rolled over a bit from here. If the market can break above the 1.30 level, then it’s very likely to go looking towards 1.32 level above which is even more resistive. A break above that level then allows the market looking forward towards the 1.35 handle above.
GBP/USD Video 26.02.20
Looking at this chart, the 1.2850 level seems to be rather supportive, and if we were to turn around a break down below there then the market goes looking towards the 200 day EMA which is a bit closer to the 1.27 handle currently. All things being equal, I do believe that this market will eventually try to form some type of base and go higher, but I need to see a daily close above the 1.30 level to be comfortable buying. Even then, this pair has a huge sensitivity to noise out there, so don’t be surprised at all of this market continues to cause a lot of headaches. That being said, the British pound is historically cheap so it would follow that eventually it should rally significantly. All things being equal though, expect a lot of choppy behavior over the next several weeks, if not longer.
This article was originally posted on FX Empire
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