The GBP/USD pair fell hard during the session on Monday, as the general “risk off” attitude certainly hit the Forex markets. However, you can see that we stopped for the 1.63 level, an area that has been rather supportive over the last several months. With that, it does not surprise me that the market stopped right here, but now we have to wonder whether or not we will find enough support to keep the market somewhat afloat? With that, I’m not ready to sell this market, and quite frankly am looking for some type of buying opportunity in this general vicinity.
If we can get some type of supportive candle realm 1.63, I think we could go back to the 1.65 handle without too many issues. However, we have to keep in mind that the nonfarm payroll announcement comes out this Friday, so that of course will have the markets going back and forth between now and then. With that, I suspect that we won’t get any decent moves until Friday, but nonetheless I do think that the uptrend is the only way to trade this pair, and much like the stock markets right now, we may simply be seeing some type of pullback that offers a buying opportunity.
Patience will be crucial.
Being patient during this time will be crucial, and simply waiting to get the buy signal is what you need to do. After all, you never know what the nonfarm payroll report will bring, as the last one was a complete shock. Now the world will wait to see whether or not the Americans have been hiring, and as a result it will certainly affect the risk appetite around the world. The British pound itself has done relatively well over the last several months, so this pullback has been somewhat surprising. However, we have not broken down despite how desperate the situation has look over the last several sessions. Nonetheless, I’m not ready to step in front of this freight train quite yet, so I will more than likely be very cautious about going long, but I certainly won’t be going short.
