The GBP/USD pair went back and forth during the session on Thursday, but remained above the 1.60 level by the end of the day. That being the case I believe that this market will continue to stay above that level, and as a result I'm looking for some type of supportive action in order to go long. There is a significant amount of support just below the 1.60 handle as well, so truthfully I believe until we get below the 1.59 level, we have absolutely no way to short this market.
This is probably being driven more by the US dollar and its weakness, than anything to do with Great Britain. With that in mind, I believe that this market will continue to consolidate in this area, and will eventually break above the 1.63 handle, sending this market much higher, possibly the 1.65 handle next.
I believe that this market will continue to consolidate in this area in the short term, and as a result I think short-term traders will continue to do very well in this market, playing the range. I think that if you are short-term trader, you can look for a short-term buying signal, perhaps a supportive candle in this general vicinity in order to buy and hang onto for a couple hundred pips.
European Union exits recession, the United Kingdom should benefit.
With the European Union exiting recession, it should benefit the United Kingdom as the British send so many of their exports into the continent, and as a result I believe that the British pound should continue to do at least relatively well. With that in mind, this is simply a matter of the US dollar being weaker than most currencies, with the Pound being the same as many other currencies.
If you get below the 1.58 level on a daily close, you could see a significant selloff in this market, but right now I do not believe that's going to be the case. Because of this, I am bullish of this market, but I also recognize that if you want to see fireworks, it might be a while.
