The British pound rallied after initially falling during the trading session on Tuesday, as we approached the crucial 1.25 handle. That being the case it’s very likely that the market will pause here ahead of the Federal Reserve meeting. Because of this, it’s very likely that the next 24 hours will be quiet until 2 PM Eastern Standard Time, when the statement comes out. It’s very likely that we will see a dovish Federal Reserve, so that could provide the reversal. Having said that, keep in mind that we still have to worry about the Brexit so I don’t know that we bounce significantly. It’s very likely that we will see a scenario where we simply get a bit of relief for the British pound as the US dollar should soften.
GBP/USD Video 19.06.19
With the ECB sounding very dovish during the trading session on Tuesday, this has put significant pressure on the Federal Reserve to step in and sound just as dovish, otherwise the US dollar will start to strengthen even further, putting a lot of pressure on assets around the world. Ultimately, this pair is a little bit of an outlier though, because we have the Brexit and all of the circus like antics they go along with this sideshow. If we can break down below the 1.25 level though, we could unwind down to the 1.2250 level next.
Please let us know what you think in the comments below
This article was originally posted on FX Empire
More From FXEMPIRE:
- Oil Rebounds On Bullish Data, OPEC Meeting Date Set, Trade-Optimism Fuels Demand Hopes
- Silver Price Forecast – Silver markets continue to press resistance
- Dollar Resilience Being Tested in Lead Up to Fed Decision
- S&P 500 Price Forecast – Stock markets await Federal Reserve
- E-mini NASDAQ-100 Index (NQ) Futures Technical Analysis – June 19, 2019 Forecast
- USD/JPY Price Forecast – US dollar choppy against yen