GBP/USD Price Forecast – British Pound Drift Lower

The British pound initially rallied ever so slightly during the trading session on Friday but gave back the gains to show signs of weakness. At this point time, the market is looking for some type of clarity, and I think at this point we are trying to reach towards the 1.38 handle, which could possibly also be lifted by the 200 day EMA which is reaching towards the 1.37 handle. Ultimately, this is a market that I think will continue to see a lot of noisy behavior, trying to figure out whether or not the British pound can continue to go higher, or if the US dollar is suddenly going to strengthen against everything? I think we are on the precipice of some type of bigger move one way or the other.

GBP/USD Video 28.06.21

To the upside, the 1.42 level should continue to offer major resistance, and of course the 50 day EMA also starts to look as if it is resistance as well. All things being equal, the market is likely to see a lot of volatility, but I think we are probably going to drift a little bit lower more than anything else, only to find buyers again. However, if we were to break down below the 200 day EMA, we could see this market start to fall rather significantly.

In the meantime, I think that there will be a lot of volatility in choppiness more than anything else, so it does make a certain amount of sense that you be cautious with your position sizing, as there seems to be a lot of confusion out there with the future of monetary policy in the United States.

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