GBP/USD Forecast July 13, 2017, Technical Analysis

The GBP/USD pair had a volatile session on Wednesday, as Janet Yellen testified in front of Congress. This of course has a lot of effect on the US dollar, which in turn has an effect on this market. The British pound has been on a downward trajectory, but as we approached the 1.28 level underneath, we bounced significantly, and I believe that level will continue to hold as support. The market should continue to offer consolidation between the 1.28 level on the bottom and the 1.30 level on the top. The market seems likely to be very choppy as we await the results of negotiations between the United Kingdom and the European Union, and of course headlines can cross the wire at any point to rock this pair back and forth. With this, I think that if we stay between these 2 levels, it’s likely that we trade back and forth, with buyers being very interested in this market near the 1.28 level, and sellers of course near the 1.30 level.
Longer-term moves don’t happen until the break out
Longer-term moves of course don’t happen until we get a breakout of this range, and decidedly so on the daily chart, if not the weekly chart. Because of this, I think you should stick to short-term trading, and I believe that the summer liquidity is going to work against larger moves. So, I think looking at this is a 200-pip range is probably about as good as it’s going to get. Once we do get that break out though, I think that the market should have quite a bit of follow-through, as we will have certainly made a significant decision as to which direction we were going. Being patient is your best friend.