The GBP/USD pair broke out during the Wednesday session, clearing the 1.58 level in reaction to statements coming out of the FOMC meeting. That being the case, the market looks like it is ready to go much higher, perhaps starting a new uptrend and sending the value of the British pound even higher. Quite frankly, I have been impressed with this currency for some time now, so this move is what I was anticipating, I just did not expect to see it happen so forcefully and in such a short amount of time. Nonetheless, this simply means that I continue to buy British pounds going forward.
I believe the pullbacks will continue to be buying opportunities, and that it’s only a matter of time before we should then head towards the 1.60 level, which of course is a major target above. I also believe that we will break above there given enough time as there is more than enough bullish momentum underneath to drive this pair even higher. After all, the British pound seems to be strengthening and against almost all currencies around the world, so with that area difficult to imagine a different outcome.
I continue to buy dips not only here, but into the future. I believe that the 1.55 level is essentially the “floor” in this market, and that it’s only a matter of time before that floor rises. I think the 1.57 level will be next, and then the 1.58 level. In other words, I’m very bullish on the British pound and believe that it will continue to strengthen not only against the US dollar, but against most currencies in general. The move that had occurred during the session against the Australian dollar was quite impressive as well, and several other currencies could be brought into focus as the British pound suddenly becomes the currency to own. In fact, I believe that it’s probably one that will continue to trend much higher, and that I will be holding onto for a significant amount of time.