GBPUSD
The GBPUSD pair remains bullish while the price action continues inside of a rising channel. The bullish momentum started in September and continued for over two months. Now that the EU and the UK announced a withdrawal agreement in place, cable has a chance to make a new high.
The dominant theme on the FX market remains – weak USD. As such, not only the GBPUSD is bid, but the EURUSD or AUDUSD as well. In the case of cable, in particular, the Brexit negotiations added to the volatility. However, any pullback proved to be short-lived if we consider the cable’s ability to remain in the rising channel.
Yesterday’s announcement that the UK will back off and not break international law created a strong reaction on the market. While cable found support at the lower edge of the channel, the EURGBP cross moved back to the pivotal 0.90.
The technical picture is pretty simple and offers alternatives to both bulls and bears. Bulls may want to stay on the long side or enter on a new trade every time GBPUSD moves into the lower half of the channel. Bears, on the other hand, may want to wait for a break below 1.32 before going short. In both cases, the proper stop loss must be set at the opposite edge of the channel.
