GBP/USD Price Forecast – British Pound Breaks Through Technical Barrier

The British pound has initially tried to rally during the trading session on Friday but then turned around a break down below the 1.25 handle. We are below the 200 day EMA so a lot of traders will look at this as a downtrend, and therefore one would have to think there is a certain amount of questions out there as to whether or not we can continue to absorb the type of negative pressure. If we break down below the lows of the Friday candlestick then it’s very likely that the market goes looking towards the 1.2250 level. Below there, the 1.20 level would be the next target.

GBP/USD Video 16.03.20

Other hand, if we were to break back above the highs of the Friday session it’s likely that we could go to the 200 day EMA, and perhaps even break above there. If we can break above the 200 day EMA, it’s very likely that the market then goes looking towards 1.30 level. It will probably come down to whether or not there is massive stimulus coming out the United States which could devalue the US dollar. Furthermore, the United States is likely to cut interest rates by at least 50 basis points next week, so at that point it could be based upon whatever Jerome Powell says. In other words, were going into the weekend at a large, round, psychologically significant level, and simply waiting to see what central planners are going to do next. In general, I do believe that the British pound is probably going to struggle overall.