GBP/USD Price Forecast – British Pound Continues to Probe Lower Levels
The British pound has gone back and forth during the course of the trading session on Thursday to show an attempt to break down below the 1.34 handle. The GDP numbers in the United Kingdom are now lower than they were pre-pandemic, so it does suggest that perhaps the British pound is going to continue to sell all. If we break down below the bottom of the candlestick for the trading session on Thursday, that could lead to a massive selloff at this point. Quite frankly, the dip that we had below the 1.34 handle is a very negative sign, and a shot across the bow.
GBP/USD Video 12.11.21
If we break above the highs of the day, then we could make a move towards 1.35 handle, but I would anticipate a bit of selling pressure in that area as the United States is starting to price in several rate hikes in the short term. Whether or not that is true might be a completely different question, but that is what the market thinks. At this point in time, I still look at short-term rallies as selling opportunities in this currency, as the British pound has been underperforming for a while. While I had initially thought that the 1.34 level would be the absolute bottom, it is clear that it is not as solid as I once thought, and therefore I simply roll with the changes and look to the US dollar in this particular market. It is not until we break above the 1.36 level that I would be a buyer of this market. At this point, it looks like we are going much lower.
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