The British pound continues to be very choppy, hanging around the 1.30 level as the markets are trying to find some type of general direction to follow. Ultimately, this is a market that can’t seem to get ahead of itself but isn’t exactly breaking down either. With that being the case it’s likely that we will continue to see a lot of noisy trading, but the real pushback was on Friday when retail sales in the United Kingdom came out very weak. Having said that, the market has broken through a lot of resistance as of late, so it would make sense that the British pound would take off to the upside.
GBP/USD Video 20.01.20
However, we do not have any type of catalyst right now, and the market is more or less in a “holding pattern” as the markets have frozen up in general. It’s not just the British pound, the entire Forex complex that has seemingly taken a bit of a holiday. With that, look at the 50 week EMA underneath as potential longer-term support, but if we can break above the top of the couple of shooting star shaped candles above, then the British pound can take off. It certainly seems as if it is struggling to make sense of where we are going because the last four candlesticks have been a hammer, a shooting star, another shooting star, and now a neutral candlestick. In other words, we have nowhere to be anytime soon. We will eventually get some type of impulsive candlestick and then can follow in that direction.
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This article was originally posted on FX Empire
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