GBP/CHF
The British pound has broken to the upside against most currencies around the world, and it seems as if we are continuing to see a lot of congruence as the British pound seems to be getting over the idea of a “no deal Brexit” as Teresa May has acquiesced to the idea that possibly the Brexit could be delayed.
This of course in the end won’t matter, but it’s very likely that the relief rally should continue. When you look at the weekly chart of the GBP/CHF pair, we finished February with a very strong tone, breaking above the 1.3250 level. At this point, it’s very likely that we will see some type of pullback that offers value. It’s almost impossible to short the British pound after the massive moves that we have seen, and on the weekly chart in the GBP/CHF pair we have a huge “W pattern.”
That of course is a very bullish sign and it looks like we should continue to see buyers. The pattern measures for a move to roughly 1.37, which was the most recent high on the weekly chart. This makes a lot of sense, and it’s very likely that we should have plenty of buying opportunities on dips. Adding on the short-term pullbacks that show signs of support will be the way to trade this pair going forward. The British pound has bottomed overall, as traders are starting to price in the idea that the United Kingdom will still exist at the end of the year. (As with most things market related, we had gotten out of control.)
This doesn’t mean that there won’t be the occasional bump in this market, but I believe that the bottom of this pair right now looks closer to 1.30 more than anything else. Look for value, and take advantage of it.
