British Pound Riding the 200 Day EMA

The British pound has rallied a bit during the trading session on Wednesday as we continue to hang out right around the 200 day EMA. In fact, it has offered a lot of support over the last couple of days but as you can see there is plenty of resistance above that causes major headaches. With that being the case, it should not be a huge surprise that essentially the market is going nowhere, and I think that may continue to be the case as both central banks are essentially hawkish going forward. That will have a major influence on how the market behaves, as both of these currencies are favored at the moment.

GBP/USD Video 24.02.22

As things stand right now, I believe that the 1.3650 level is a major resistance barrier, just as the 1.35 level is a major support level. As long as we stay within these two levels, I think the market is more likely than not going to be more of a sideways endeavor than anything else. I have no interest in trying to get too cute with this market, but I do recognize that if you are a short-term trader, you may like this type of environment as it becomes more of a range bound situation.

If you do choose to go down that path, make sure that you keep your position size reasonable as the volatility will eventually break out in one direction or the other. That being said, I just do not see this market ready to take off quite yet, although it must be stated that as of late there has been a bit of a resilient attempt to break out to the upside.

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