The British pound has fallen again during the week, as we continue to see a lot of noise out there when it comes to Brexit and a whole host of other issues. This is a market that continues to be very noisy and of course focused on Brexit, but it is also focused on the fact that the United States dollar continues to show signs of strength. After all, the US dollar picking up strength in a time where there is so much uncertainty is not necessarily a novel idea, and therefore it should not be a huge surprise. At this point, I look at the 1.30 level as a major resistance barrier that needs help to get crossed above.
GBP/USD Video 28.09.20
Looking at the underneath, it is likely that the market goes looking towards the 1.25 level. At this point time, the market is likely to make a bigger decision, and at that point it will have to decide whether or not we are going to completely fall apart. There are a lot of concerns out there globally, so it does make sense that we may make an attempt to do that. However, you should also keep in mind that one day you could wake up after some Brexit rumor or headline has come out and see the British pound break above that 1.30 level just as easily. Because of this, it is going to be very difficult to trade this market and therefore you need to keep your position size relatively small. All things being equal, this is a market that is going to remain very difficult but when you look at the pullback that we have seen, it certainly looks like several of the others in the past.
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This article was originally posted on FX Empire