The GBP/USD pair rose during the session on Friday and even managed to break through the 1.63 level at one point. However, by the end of the day we saw a pullback that formed a shooting star. This pair has been overbought for a while, and as such a pullback would be welcomed by many of the buyers at this point. We still see the 1.60 level was massively supportive at this point time, and hope that a pullback is a chance to start buying this market somewhere closer to that level.
However, we managed to break the top of the shooting star from Friday, then of course is a massively bullish signal as well. Even if we do see a breakdown of price over the next day or two, we are not interested in selling as the central bank equation of this currency pair is pretty straightforward: the Federal Reserve is looking to expand its quantitative easing, and the Bank of England is looking to sit still with its rates. Because of this, there is a positive swapped going long this pair.
Written by FX Empire