GBP/USD: Is it worth going long or sitting on your hands a little longer?
Recent sentiment overall for the Great British Pound has been nothing short of disastrous. Declines across the board, ranging from 5-8% in the past 2 months of trading. The question is “Is now the time to buy?”
When looking at either buying or selling a currency the first question I ask myself is, “Is it currently trading at an attractive level?” Is there sufficient room for the trade to go in my direction and hit my target area and am I protected by a good number of confluences. Two critical questions I ask myself before pulling the trigger.
In my opinion, there is definitely an opportunity to the long side on the pound but the tricky question is, when, when to pull that trigger and enter the trade. Sentiment for the single currency is currently driven by Brexit and we are still in a stalemate with this, so there isn’t enough for me to pull the trigger... YET. I am monitoring this closely however as I feel we are fast approaching that point where I do pull the trigger and enter.
Technically, we are currently sitting above the big phycological level at 1.25 where we do have some very good support that has held since the start of the year. I would not be surprised if we get one final spike down to the 1.20-22 region before reversing and accelerating much higher.