The British pound has rallied significantly, reaching towards the 1.24 level during the early hours on Monday session, but then pulled back just a bit. Ultimately, the 1.25 level above should also be massive resistance, so I am looking to short the British pound given enough time. However, I do not have the technical set up quite yet and therefore it will be interesting to see whether or not we get some type of exhaustion that we can jump on. After all, the British pound is going to have to deal with the Brexit situation, which of course is not going to be easy.
GBP/USD Video 02.06.20
Ultimately, the 50 day EMA could determine a lot of things so if we were to break down below the 50 day EMA again, then I might be willing to throw on short position. Otherwise, some type of exhaustion near the 1.25 handle, then I would be willing to sell in that area as well. Above there, we have the 200 day EMA that is coming towards that area, so I do believe that it is only a matter of time before the selling comes back into play. At this juncture, if we were to break above there then it is likely that the market could snap towards the 1.30 level in a massive move of momentum. Ultimately, this is a market that is setting up for a nice trade, but it is not quite there yet, but I certainly have this pair on my radar.
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This article was originally posted on FX Empire
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