The British pound continues to grind back and forth against the US dollar as the Monday session was no different than the last few before it. Currently, looks as if the market is content to simply go back and forth as we await several economic indicators coming from London, and that of course will have a direct influence on this pair. Because of this, I am ignoring all fundamental noise and simply looking for technical setups. I currently believe that a move above the 1.3050 level should send this market higher and have traders coming in to buy for longer-term moves, perhaps to the 1.32 handle.
The alternate scenario
However, we breakdown below the 1.2950 level on a daily close, then I think we’re going to go lower, probably to the 1.2850 level next. A breakdown below there would be very negative, and send the British pound much lower. Ultimately, I think that we may get some quiet trading over the next couple of sessions, and less something truly remarkable comes out of the economic figures coming from the United Kingdom this week. We are in the height of vacation season, so it makes sense that we might perhaps sit still for a little while.
Written by FX Empire