GBP/USD Price Forecast – British Pound Continues to Look Soft

The British pound has gone back and forth during the course of the trading session on Tuesday as we continue to dance around the 1.3750 level yet again. This is an area that has been both support and resistance, and now it looks like it is essentially where the market “feels the most comfortable” at this point in time. Furthermore, the 50 day EMA sits right in the same area, so that of course makes a certain amount of sense as well. The “market memory” from the massive amount of resistance at the beginning of the year is also coming into play, but we have seen the US dollar strengthened quite drastically in order to also cause some issues.

GBP/USD Video 31.03.21

To the downside, the 1.35 level is going to be a target for sellers, but if we were to turn around a breakout above the top of the Monday candlestick, that could open up a move to the 1.40 level above which is a large, round, psychologically significant figure, and an area where we have seen a certain amount of resistance as of late. If we were to break above there, then it is possible that the market goes looking towards the 1.42 level, an area that sees a significant amount of resistance.

I think the one thing you can count on is a lot of volatility in choppiness, so therefore I would keep my position somewhat small and look at it through the process of what is going on in the United States more than anything else, as yields in America are by far the biggest driver of currencies at the moment.

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