British Pound Looking for a Bounce
British Pound vs US Dollar Technical Analysis
The British pound has fallen a bit during the trading session on Friday to show signs of weakness again, but we have turned around as the jobs number in America shows that things were essentially the same. At this point, it looks like we are going to get a little bit of a bounce which makes a certain amount of sense as traders will look to close out positions before the weekend. After all, we had seen a massive red candlestick during the previous day, so at this point, it is likely that we continue to see plenty of downward pressure.
If we were to break down below the candlestick that is forming for the Friday session, I think the British pound could go looking to reach the 1.22 level. Above, the 1.26 level should be a significant resistance barrier, so I think that any type of exhaustion on a short-term chart is more likely than not going to be a selling opportunity, and perhaps more specifically, “offering cheap dollars.”
Even if we break above the 1.26 handle, the 50 Day EMA is slicing through the 1.30 level, and racing lower. That of course should offer a certain amount of dynamic resistance, and therefore I think traders will pay close attention to it. Either way, this is a market that should continue to be noisy and choppy, but ultimately this is a scenario where we are more likely than not going to fade rallies, as the Bank of England has suggested that a recession is coming to the United Kingdom, while the Federal Reserve still lives in fantasyland and still looking to raise rates into a slowing economy.
GBP/USD Price Forecast Video 09.05.22
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