The GBPUSD pair broke out a few sessions ago as we cleared the 1.58 handle. On Monday, we pulled back to find support at that previous resistance barrier, something that you would expect if you use technical analysis for your trades.

With this, we really like the idea of buying in this general vicinity, and on the shorter-term charts we are starting to form hammers. That of course is a very bullish sign so we really like going long of this market. We believe that there is support all the way down to the 1.57 level, and as a result have no interest in selling at all.

We believe that the British pound will continue to strengthen against almost all currencies out there, and that the GBP/USD pair is essentially the measuring stick of British pound strength overall. With that, we believe that as long as is market goes higher, you simply cannot sell the British pound against just about anything.

It’s not that we believe that the US dollars going to meltdown or anything just simply that the British pound is suddenly starting to look very strong. We do not want to fight this type of momentum, and therefore all we can do is buy this market as it is obviously trying to break out. However, that is a situation where we will have to break your all the noise above, which we see going all the way to the 1.60 level.

With this, we are not only a buyer on supportive candles on shorter-term charts, but we also like the idea of buying pullbacks time and time again, as the buyers jump in to take advantage of the uptrend, and will use short-term charts in order to do the long trades. We believe that eventually we break over the 1.60 level as well, so having said that it’s only a matter of time before we go even higher than that and we believe that this could very well be the beginning of a multi-year uptrend in the British pound going forward.

Editor’s Note: Equity investors/traders can use the Currency Shares British Pound Sterling Trust (FXB, quote) ETF to take positions in the yen without a FOREX account.  The ETF looks to track the price of the British Pound Sterling (GBPUSD), minus ETF fee. The fund seeks to reflect the price of the British Pound Sterling (GBPUSD) with the shares representing a cost-effective investment relative to investing in the FOREX market.

Content curiosity of FOREXCycle