British Pound Continues to Threaten a Bounce

British Pound Continues to Threaten a Bounce

There is no doubt that the market was extremely chaotic during the trading session on Tuesday. This background noise will remain an issue in the overall. The volatility is likely to be high as Trump has been speaking about tariffs and traders aren’t sure how to deal with this.

The technical analysis of this pair, naturally is quite negative and at the moment as if we may observe a small amount of an upward movement, however this bounce is very likely to encounter resistance again, starting at the 1.2350 level, and after it at that 1.25 level. Even though we’ve seen a good improvement during the trading session in the past two days, I do not have any desire to buy this pair. I believe that a rebound at this point is likely to provide a selling opportunity. It’s been the case for a long time.

If you consider the state of affairs it’s an important low in the past few years, but there’s nothing to suggest, at the very least at the moment that the British recovery of the pound will be one that lasts. In all honesty, we’d require something to happen to the US dollar to be able to sustain it, but we’re not quite there yet.

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That being said, I see rallies as shorting opportunities when there is the earliest sign of exhaustion. However, I am aware that we’re oversold, and this could be something will be watched for the next few days and profit from whenever that exhaustion candle is visible. If we could get above the 50-day EMA and then start to consider an upward trend, but it would be necessary to witness the US dollar weakened.