GBP/USD Weekly Analysis for Binary Options
The all-important general election in the UK is now one week away and the GBPUSD pair continues to trade in a sideways and unpredictable manner which is in line with the current political backdrop, note Binary Options Brokers. The complexity of the situation in the UK makes the outcome of this election very hard to predict and it even seems harder to predict how would GBPUSD react in the immediate aftermath of the election regardless of who wins.
The general expectations are for the Conservative party to win the election on June 8, however, it’s still not entirely certain how positive would that affect the Cable pair. An overwhelming majority for the Conservatives is the most certain positive outcome for Sterling, but recently the Conservatives lead in polls has dwindled and such an outcome seems less likely now.
Longer term, in the next few months analysis at Binary Options Brokers, suggests that the GBPUSD pair should recover above 1.30 and maybe toward the mid 1.35s.
In the next two weeks, the Federal Reserve meeting and rate decision on June 14 will also be important for the GBPUSD pair where it’s expected for the Central Bank to raise rates.
Given the upside bias for the pair, but still, with many risks ahead, a strategy to consider might be to open call binary options positions playing both the election on June 8 and the longer term as we discussed.
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The pair has finally reversed the uptrend last week and in line with this an extension of this move lower seems like the path of least resistance. Watching the behavior inside and around the current bearish channel will give clues on how lower can GBPUSD go or when it may reverse Binary Options Brokers recommend.
It’s worth noting that the pair almost formed a bullish hammer at the 1.2770 lows near current levels, but a breakout higher of the channel will be needed to confirm a bottom here.
On the other hand, a move below the 1.2770 support will open the way to the next support levels at 1.2650, 1.2550 and the 1.23 – 1.24 area (which is the neckline of the inverted head and shoulders pattern on the weekly chart).
The highs at 1.3050 remain important resistance in the longer term.
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Your capital may be at risk. This material is not investment advice
I've been a professional trader for over 5 years.
Currently I work as forex analyst for different investment companies.
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