GBP/USD Price Forecast – British Pound Breaks 50 Day EMA

The British pound continued to rally against the greenback during the trading session on Friday after the Non-Farm Payroll numbers came out 500,000 jobs less than expected. This of course had a detrimental effect on the US dollar, which had already been selling off during the week. Because of this, this is simply yet more grinding to the upside, as the world is trying to figure out exactly what is going on due to the Delta variant and so many other issues.

GBP/USD Video 06.09.21

Now that we are above the 50 day EMA, technical traders may look at this as breaking out of a squeeze that we had been in previously, as we were stuck between the 200 day EMA and the 50 day EMA. Now that we are out of it, it certainly looks as if we are going to continue to see an attempt to break out to the upside. Clearing the 1.39 level is the next barrier, right along with the 1.40 level after that. Short-term pullbacks are most certainly possible at this point, but it certainly is to me as if the buyers are trying to take over and send this market much higher.

To the downside I believe there is a significant amount of support, extending down to the 1.37 level. That is where the 200 day EMA sits, and of course the area has been important more than once. Ultimately, I think this is going to give us an opportunity to see buyers on dips, as it now is starting to look much more likely that the recent double bottom was in fact something important to pay attention to.

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