GBP/USD Price Forecast – British Pound Continues to Limp Along

The British pound has gone back and forth during the course of the trading session on Wednesday as we continue to see the US dollar try to strengthen against most currencies. It should be noted that the British pound has been one of the better performers over the last year or so, so it should not be a major surprise that perhaps we will see it put up a little bit of a fight at this point. That being said, if the US dollar starts to strengthen across-the-board, it will be felt here as well.

GBP/USD Video 01.07.21

Underneath, the 1.37 level is an area that has to be paid close attention to as it has already offered support, and of course we have the 200 day EMA reaching towards it as well. It is flattening out a little bit, so that does suggest that perhaps we are going to see a lot of buying pressure in that area. Having said that, if we break down below the 200 day EMA, then it is likely that the market could go looking towards the 1.35 handle, an area that obviously has a certain amount of psychological importance as well. Breaking down below the 1.35 handle could open up a much deeper correction.

It is worth noting that the 1.42 level has been important for the market as resistance more than once, and when you look at the monthly chart it is clearly an area that is difficult to get beyond anytime soon. Now that we have seen the market test that area and fail, people have to wonder whether or not we have seen the top. It is a little early to call that, but we are getting close.

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