The GBP/USD pair initially tried to rally during the course of the day on Thursday, but as you can see the 1.52 level continues offer a significant amount of resistance. With that being the case, it appears that we are going to continue going lower, but with today being Nonfarm Payroll Friday, the reality is that we will have quite a bit of volatility in the markets, and as a result it’s probably only going to be a matter of time before we get an opportunity to sell, perhaps even after a rally. In fact, that’s exactly what I am anticipating happening, and quite frankly hoping for.
If we can break above the 1.52 level, I feel that we would then reach towards the 1.53 level, and then possibly even the 1.54 level. I think that any rally that is a result as a knee-jerk reaction to the jobs number should be thought of as a potential opportunity to pick up value in the US dollar.
Selling rallies, as well as breakdowns
Looking at this market, it appears that every time we rally the market should continue to attract sellers. I also believe that a break down from here should send this market much lower. Were probably looking at a move down to the 1.50 level, and as a result this market will more than likely look for some type of reaction based upon a large, round, psychologically significant number, which of course attracts a lot of orders.
Looking at the recent candles, you can see that there continues to be quite a bit of pressure. The fact that we formed a shooting star during the session on Thursday of course is negative, but you also have to look at the Wednesday and the Monday session as well. It seems that we continue to show that the British pound just cannot “get out of its own way.” I still believe that the US dollar is the favored currency around the Forex world.
