GBP/USD Price Forecast – British Pound Continues to Hover Around 50 Day EMA

The British pound has rallied ever so slightly against the US dollar on Monday to hang about the 50 day EMA again. At this point time, the market looks as if it is trying to go higher, but really at this point in time is going to struggle to break above 1.35 between now and New Year’s Day. What happens next remains to be seen, but I think the real argument will be decided in early January, probably after the jobs report.

GBP/USD Video 28.12.21

In the short term I would anticipate a lot of back and forth, hovering around his 50 day EMA. I am not expecting much in the way of movement, but I do recognize that the British pound had a really good week last week, unlike many of the other currencies out there. Nonetheless, this week tends to be very thin and nondirectional, and I would anticipate that you have to probably approach this on short-term charts with more of a back-and-forth type of deal.

The stochastic oscillator might be a good thing to use on short-term charts, but basically that is about as exciting as this is going to get in the short term. Once we do get past the New Year’s it is likely that we will see bigger moves but until then I would not put a bunch of money into this market. Most traders I know actually step away from the market this entire week because it simply does not make any sense to play games with illiquid conditions. The 50 day EMA is flattening out, so that does suggest that perhaps we have nowhere to be.

For a look at all of today’s economic events, check out our economic calendar.