The British pound falls during Friday trading

The British pound broke down during the trading session on Friday, reaching down to the 1.3750 level. That’s an area that has been support in the past, as well as resistance. I think that by pulling back the way we have, value hunters might be interested in this market, but I also see a significant amount of resistance near the 1.40 level above. I think that breaking above that level should be a buying opportunity, and I would be more than willing to put money to work at that point. However, I think it’s likely that the market would show signs of exhaustion there and I think we are going to continue to see a lot of volatility as the US dollar has been strengthening overall as the interest rate markets have been offering more yield in America.

If we do break down from here, I believe that the 1.3650 level underneath is massive support, there’s a major uptrend line at that level as well, and I think that the market breaking below there would be an easier way to trade this market, shorting it drastically. However, I think we are likely to see a lot of back and forth, perhaps using the 1.3750 level as a short-term floor, while using the 1.40 level as resistance. I think that the market will continue to be very noisy, especially considering that there is so much going on with the negotiations between EU and the UK. Ultimately, be rapid and small with your trading.