The British pound rallied significantly during the course of the trading week to break above the 1.37 handle. This of course is a bullish sign, and it certainly looks as if we are ready to continue trying to press to the upside. If and when we do, the market is likely to go looking towards the 1.39 level. The US dollar has been hit kind of hard against multiple currencies, with the British pound being no different. At this point, it looks as if we are trying to go much higher, and I think that is probably going to be the story going forward, that the US dollar is going to start being sold off again.

GBP/USD Video 18.10.21

That being said, if we were to turn around and wipe out the candlestick from this week, that would be a very negative turn of events. In that scenario, I would anticipate that the US dollar will probably rally against most things, not just the British pound. The market will continue to be very noisy to say the least, but it certainly looks as if we are going to try to continue the overall upward movement that we have seen for some time, as we head a nice pullback as of late in order to create a bit of value in what had been a steamroller of momentum. Looking around the Forex world, it seems as if the last couple of days have been extraordinarily negative for the greenback, and therefore the momentum seems to be picking up in general.

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This article was originally posted on FX Empire


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