GBP/USD Price Forecast – British Pound Continues to Languis

The British pound has gone back and forth during the course of the trading session on Wednesday as we are perhaps getting a little oversold at this point. If that is going to be the case, then it does make a certain amount of sense that the market would start to bounce a little bit. The 200 day EMA sits just above, and it of course will attract its own attention, not to mention the fact that the 1.37 level is just above there, an area that had previously been significant support, and should now be resistance based upon market memory.

GBP/USD Video 22.07.21

To the downside, I still think that the market could very well go looking towards 1.35 handle, but that does not necessarily mean that it has to happen overnight. A little bit of a bounce does not change that thesis, at least not until we break above the 50 day EMA on a daily close. At this point, I would anticipate that we get a little bit of recovery for the short term, and then have a bigger fight on our hands once we get to the 1.37 level. At that point, I think we will answer quite a few bigger questions.

The British pound is probably going to be thrown around by the situation in the United Kingdom as the Delta variant continues to pick up, but at the same time the British government is trying to reopen everything. With that being the case, there will be a lot of noise around this pair, and it should also be noted that the US dollar will of course be favored as a safety trade, and therefore if things do deteriorate that could also help push this thing lower. Breaking the 1.35 level to the downside would be very negative.

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