The British pound has rallied a bit during the week, as we continue to find bullish pressure to send the market higher. At this point in time, is very likely that the market will continue to see buyers on dips, as it looks like we are trying to build up enough momentum to finally go out to the upside and break above the 1.30 level. If we do, then it opens up the door to the 1.33 handle, and then eventually the 1.38 level. The flag of course is something that almost everybody is paying attention to, and quite frankly it only needs some type of catalyst to kick off.
GBP/USD Video 18.11.19
It is easier to see on the daily chart though, as it is much more pronounced but in the end it’s all the same. It looks as if the British pound has found the 1.20 level to be massive support as it has formed a longer-term “double bottom.” At this point, it’s very likely that the market will continue to go higher over the longer term and therefore if you are a longer-term investor, the British pound offers a lot of value.
Obviously, there are a lot of noisy headlines involving Brexit, so you will have to have a small enough position that you can get the advantage of being able to have large stop losses. Quite frankly, this is setting up for an investment, not a trade. Ultimately, I have no interest in shorting the British pound although I do recognize that pulling back is very possible before a surge higher.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
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