British Pound GBP Trend Analysis

Currencies / British Pound Oct 14, 2019 - 04:36 PM GMT

GBP Long-term Trend

What stands out from the long-term chart is that GBP has been in a downtrend for many years, a good 20 years in fact for I recall sterling trading at over £/$ 2.0 a few years earlier than this graph. So whilst the clueless mainstream press have been crowing since 23rd of June of how the Pound has collapsed following Brexit. What they fail to understand is that Pound would have fallen regardless of the results of the 23rd June 2016 referendum because it's in a bear market.

All that the rally in run up to the referendum was is a counter rally in a bear market. How low would the British Pound have fallen if the UK had voted to REMAIN? Well to at least to 1.30. So maybe not as low as recent sub 1.20 levels 20 but 1.30 was still doable in GBP's long-term bear market.

The second thing that stands out is that after sterling breaks to new lows it then tends to settle into a multi-year trading range as was the case from 2009 to 2015, a 25 cent trading range of between 1.675 and 1.42.5.

The current range is for an approx 30 cent trading range from 1.15 to 1.44. This suggests that the downside is limited to around 1.15 with probability current price action resolving in a bull run higher towards the upper end of the trading range resistance area of 1.37.5 to 1.44 with key resistance on the way at 1.33.

GBP Trend Analysis

GBP is in a downtrend off of the 1.33.5 high. Most recent price action saw a bounce off of support at 1.20. Which given the spike nature of the 2016 1.15 low then could hold. However Westminister chaos induced volatility is high which means on a short-term basis sterling could revert to trending lower, as GBP was / is over sold so was due a technical bounce. So the most recent move higher could just be that and nothing to do with Westminister Brexit chaos.

Support is at 1.20, Resistance is at 1.28, then 1.30 and 1.33. Further is 1.37 and 143.

The rest of this analysis has first been made available to Patrons who support my work: https://www.patreon.com/posts/british-pound-vs-29840414

Westminister BrExit Chaos Puts Britain into a Pre-Civil War State
Boris Johnson a Crippled Prime Minister
Boris Johnson's "Do or Die, Dead in a Ditch" Brexit Strategy
General Election 2019 - Opinion Polls
UK General Election Forecast 2019 - Betting Market Odds
British Pound vs Brexit Chaos
British Pound Fundamental Analysis
USD Index Analysis
GBP Long-term Analysis
GBP Trend Analysis
British Pound GBP Forecast Conclusion

So for immediate First Access to ALL of my analysis and trend forecasts then do consider becoming a Patron by supporting my work for just $3 per month. https://www.patreon.com/Nadeem_Walayat.

Scheduled Analysis

UK Housing market series
Machine Intelligence Investing stocks sub sector analysis
US Dollar Index
NASDAQ
EuroDollar Futures
EUR/RUB

Recent Analysis includes:

Your Analyst

And ensure you are subscribed to my ALWAYS FREE newsletter for my next in-depth analysis.

Nadeem Walayat

http://www.marketoracle.co.uk

Nadeem Walayat has over 30 years experience of trading derivatives, portfolio management and analysing the financial markets, including one of few who both anticipated and Beat the 1987 Crash. Nadeem's forward looking analysis focuses on UK inflation, economy, interest rates and housing market. He is the author of five ebook's in the The Inflation Mega-Trend and Stocks Stealth Bull Market series that can be downloaded for Free.

Nadeem is the Editor of The Market Oracle, a FREE Daily Financial Markets Analysis & Forecasting online publication that presents in-depth analysis from over 1000 experienced analysts on a range of views of the probable direction of the financial markets, thus enabling our readers to arrive at an informed opinion on future market direction. http://www.marketoracle.co.uk

Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any trading losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors before engaging in any trading activities.

Nadeem Walayat Archive

Only logged in users are allowed to post comments. Register/ Log in

The Market Oracle is a FREE Financial Markets Forecasting & Analysis web-site.
(c) 2005-2024 MarketOracle.co.uk (Market Oracle Ltd) - Market Oracle Ltd asserts copyright on all articles authored by our editorial team and all comments posted. Any and all information provided within the web-site, is for general information purposes only and Market Oracle Ltd do not warrant the accuracy, timeliness or suitability of any information provided on this site. nor is or shall be deemed to constitute, financial or any other advice or recommendation by us. and are also not meant to be investment advice or solicitation or recommendation to establish market positions. We do not give investment advice and our comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to enter into a market position either stock, option, futures contract, bonds, commodity or any other financial instrument at any time. We recommend that independent professional advice is obtained before you make any investment or trading decisions. By using this site you agree to this sites Terms of Use. From time to time we promote or endorse certain products / services that we believe are worthy of your time and attention. In return for that endorsement and only in the cases where you purchase directly though us may we be compensated by the producers of those products.