Higher volatility & Uncertainty about the new political scheme at the political structure
On the short-term , market bounced clearly to the downside after testing 1.5500 level, and still stable above it, which forms good support base that supports continuing the positive scenario in the upcoming period, and as we expected the market successful to hit 1.57s ( Penetrated it already ! ) level, where its next main target at 1.5800 level initially then 1.5960 level. taking into consideration that close below 1.5140 will push the price to decline towards 1.5020 then 1.4910 levels on the near basis. However, the uncertainty for the British pound is coming from the election and the new political structure .
Most of the currencies are going on a stabilizing rate between certain levels to consolidate the recent strong move we have seen on the last 6 months. As we have mentioned before ; the breakout was on the downside which means further drop toward 1.42 levels for the mid-term and that means the continuation for the strong dollar across the markets.
On the long-term view : still a lower levels is expected with stabilizing near 1.30s levels , the major turning point would be the May elections – The dollar effect which mainly would move the rate ; however , the stabilization is expected because of the expectation that BoE would hike rate after the Fed expected move.
The chart analysis provided for mid-term view
Daily Trend: Up
Weekly Trend: Down