The GBP has really been in focus this week. There have been some pretty significant moves and a fair few whipsaws along the way. Much of the action has been surrounding Brexit negotiations and yesterday they appeared to be taking some steps forward.
To me, this is a classic news trade. As new developments hit the wires we get moves back and forth. When trading this type of price action, I like to use the big technical levels as places to look for profit targets. And this is assuming that we make progress. There are certainly downside risks should negotiations break down.
To the upside, I’m firmly focused on a few major levels. 1.3500 is in the firing line and any new developments will take that out in today’s session. Above that 1.3540 is a key resistance level, where there has been selling in the past. Longer-term 1.3600 was the most recent swing high and I think that it might be the top of the range for the time being.
Of course, on Friday we also have US unemployment which will potentially spike the USD. However, so far the GBP/USD has been out of sync with the other majors so far this week.