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GBP/USD Price Forecast – British Pound Continues to Struggle with Resistance

By:
Christopher Lewis
Published: May 26, 2021, 14:04 UTC

The British pound has gone back and forth during the course of the trading session on Wednesday as the 1.42 level continues to cause major issues.

GBP/USD

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The British pound has gone back and forth during the trading session on Wednesday as we continue to look at the 1.42 level as a major barrier. Ultimately, this is an area that I think that eventually we will try to break above, but it is clearly an area that is going to take a significant amount of momentum. Ultimately, I think what we are looking at is a scenario that traders are looking at short-term pullbacks as an opportunity to build up the necessary momentum to finally break out. Because of this, I have a particular trade that I am waiting on, and that is a trade that I am only willing to take on a daily close above that level. If we can do that, then I think the market is likely to go higher and a very quick manner.

GBP/USD Video 27.05.21

To the downside, the market should see plenty of support near the 1.40 level underneath, as the area had previously been rather significant resistance and support given enough time. Ultimately, this is a market that I think would respect that area, especially as the 50 day EMA is coming into the picture at the same level. With this, I do believe that even if we do break down a bit from here, I would probably be a buyer in general, as there are far too many reasons to think that we will continue to see the momentum pick up, and of course the US dollar weakening into the future. With this, I do think that it is only a matter of time before we get that move to the upside, but I am not shy about picking up value at lower levels.

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About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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