GBP/USD Price Forecast – British pound continues to soften

The British pound broke down a bit during the session on Tuesday, breaking down below the Monday session and driving towards the 1.2050 level. At this point, there seems to be a lot of resistance at the 1.22 handle and I think the market is going to continue to struggle. That being said, the 1.2250 level is an area that also makes quite a bit of resistance. In other words, I’m looking for an opportunity to sell this market anytime I can, as I believe we are trying to build up the necessary momentum to break down below the 1.20 level. Ultimately, if we were to break down below that level it’s likely that the market could reach down towards the 1.15 handle.

GBP/USD Video 21.08.19

As the market is so low and below the 61.8% Fibonacci retracement level, it’s likely that we continue to drift down towards the 1.15 handle given enough time. The Brexit of course isn’t being resolved anytime soon either, so it makes sense that we continue to see a lot of selling pressure. On the other side of the equation, we have the US dollar strengthening in general as it is a bit of a “risk off” currency, and of course a lot of money flows into the US Treasury markets in a bid to find some safety. In short, I’m looking to sell short-term rallies, killing time until we get the big flush lower that’s almost certainly about to happen over the next several weeks.

Please let us know what you think in the comments below

This article was originally posted on FX Empire

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