GBP/USD Price Forecast – British pound breaks down

As Brexit continues to cause massive amounts of problems as far as clarity is concerned, it makes quite a bit of sense that the British pound will continue to suffer overall. Ultimately, this is a market that will continue to have to deal with a lot of headline risks. The downtrend is very much in Scott’s chair, and even though we’ve had a nice rally recently, the market has found resistance at the psychologically resistant and important 1.25 handle, and of course the 38.2% Fibonacci retracement level. With that being the case, it’s likely that the market will continue to find a lot of selling pressure given enough time.

GBP/USD Video 02.10.19

To the upside, the 50 day EMA which is painted in red on the chart shows quite a bit of resistance and is turning lower. I suspect that the level will continue to offer potential resistance, and I think that given enough time players will respect that as an opportunity to start selling again if we get there. If we break above there, then it would change quite a bit when it comes to this market, but currently that seems to be very unlikely.

This market could go down to the 1.20 level given enough time, but it may have a few bounces between here and there before that happens. All things being equal, this is a market that probably struggles overall, and looking at the short-term charts could lead the way for multiple selling opportunities on the way down.

Please let us know what you think in the comments below