GBP/USD Price Forecast – British Pound Continues to Sit at Big Figure

The British pound has found a bit of a magnet in the form of the 1.35 handle. At this point in time, the market looks as if it is trying to figure out whether or not Brexit is enough to keep the British pound to continue going higher. I suspect we will probably have a lot of choppy behavior ahead of us, due to the fact that people are still trying to figure out whether or not the United Kingdom economy will move forward easily. The answer is probably a resounding “no”, as there are coronavirus lockdowns in place. Furthermore, it is not as if everything was settled, just the basics to avoid massive tariffs.

GBP/USD Video 29.12.20

To the downside, the 50 day EMA sits near the 1.3250 level, an area that has been important more than once. To the upside, and what I would consider to be a short-term target, would be the 1.3650 level. After that, the 1.3750 level is also an area that would probably come into play. This is a market that is going to be more sideways than anything else in my opinion though, especially considering that the volume is going to be an issue in general. With this being the case, I think that a range bound system should probably be deployed at the moment, as quite frankly there is very little out there to get traders excited at this time of year. That being said, the market is likely to see more noisy trading than anything else. Keep your position size reasonable.

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