GBP/USD Price Forecast February 28, 2018, Technical Analysis

GBP/USD daily chart, February 28, 2018

The British pound fell significantly during the trading session on Tuesday, reaching down towards the 1.39 level. The 1.39 level has been supportive in the past, so a bounce from here would be expected. I also believe that there is a significant amount of resistance above at the 1.40 level, so I think that the market will continue to be very choppy. I think that the market will continue to be a bit difficult, so a small position size is probably preferable, at least until we get some clarity going forward.

I do believe that eventually we go higher, but in the meantime, we have a lot of noise to chew through, and that of course is the perfect scenario for volatility. I think that short-term pullbacks will offer buying opportunities, but I think that a small position will give you an opportunity to wait for the market to show where it’s going to go, and then you can start adding. If we were to break down from here, I believe that there is a “floor” in the market somewhere near the 1.3650 level. If we can remain above that level, then I believe that we are still in a bit of an uptrend, although it has been very noisy. Keep in mind that the headlines coming out of negotiations between the European Union and the United Kingdom will of course have its influence as well, but in general I believe that the British pound is still relatively “cheap.”

Written by FX Empire