GBP/USD Price Forecast – British Pound Bounces From 200 Day EMA

The pound has rallied ever so slightly during the course of the trading session on Wednesday as the 200 day EMA may have caused a little bit of buying pressure from a longer-term trend traders. Furthermore, we have the 1.37 level underneath which of course is a large, round, psychologically significant support barrier that has been respected a few times in the past. In other words, a little bit of a bounce would make a certain amount of sense in this general vicinity. However, if we were to break down below the 1.37 level, then we may go looking towards the most recent low made at the 1.36 handle, and then down to the 1.35 handle which is a large, round, psychologically significant figure and the bottom of an overall support range.

GBP/USD Video 19.08.21

Currently, we are trading between the 50 day EMA on the top and the 200 day EMA on the bottom causing a bit of a “squeeze” for those who trade moving averages. The markets tend to respect both of these, so if we were to break above the 50 day EMA, it is likely that we go looking towards 1.40 handle which has been obvious resistance multiple times. Nonetheless though, this looks like a market that is “slumping” lower, and I think this is going to be a general grind lower. This will be especially true if we continue to see US dollar strength overall, like we have over the last several trading sessions. While this is not necessarily anti-British pound, it does certainly look to be pro-US dollar.

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