GBP/USD Price Forecast – British Pound Sitting on Top the 50 day EMA

The British pound has gone back and forth against the US dollar during trading on Wednesday as we sit on top of the 50 day EMA. At this point, the trading years done and the next couple of days will probably look a lot like the last two. Traders will have to reassess everything when it come back next week, as to what the longer-term outlook for the British pound is, because while it has been an impressive run higher, I am not so sure anything has changed from a longer-term perspective.

GBP/USD Video 30.12.21

To the upside, we still have the 1.35 level above that should offer a significant amount of resistance, which could be thought of as a target in the meantime, but if we break above there then it would be a very bullish sign for sterling. On the other hand, if we turn around a break down below the 1.3375 level, then I think we try to reestablish the overall downtrend at that point. I think that the nonfarm payroll number next week is going to have a major influence on where we go initially, and between now and then we are probably looking at a lot of back-and-forth noisy behavior.

No matter what, I would not put a lot of money into work for the next several trading sessions, or for that matter I do not even know that I will be putting any money to work. Looking at this chart, even though we have had a nice rally we are still technically in a downtrend.

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