The British pound initially tried to rally against the US dollar on Monday, but found enough resistance near the 1.29 level, and therefore fell a bit. We found support at the 1.2850 level, but it looks as if the market is still trying to find support below. I think we will, and I most certainly believe that the 1.28 level is supportive enough to keep this market afloat. However, that’s not to say that it won’t be choppy, but I do think that the buyers are waiting below. The market looks likely to go back towards the 1.30 level given enough time, but we may need to build up the momentum and the support between now and then.
Waiting for bullish pressure
I’m not willing to sell this pair, least not until we break down below the 1.28 level, so I’m simply on the sidelines. I believe that waiting for some type of impulsive candle to the upside or perhaps even a daily supportive candle might be the best way to play this market. The market then you should continue to go much higher, reaching towards the 1.30 level as I mentioned previously, and hopefully make new highs, because I think that is a longer-term “buy-and-hold” signal. We don’t have that yet, so patients will be needed. This makes quite a bit of sense though, because the economic calendar is reasonably light over the next several sessions, and because of that I think Forex markets in general might be a bit quiet.
Written by FX Empire