GBP/USD Price Forecast – British Pound Fails at 50 Day EMA

The British pound has initially tried to rally during the course of the trading session on Thursday but as we continue to see the 50 day EMA offer a bit of resistance throughout this week. At this point, the market looks as if it is going to test that hammer from the previous session, and if we were to break down below the hammer, which could open up even more selling, perhaps reaching down towards the 200 day EMA. The 200 day EMA of course is a longer-term indicator that people pay close attention to, so the fact that it sits right at the 1.37 handle will probably make it quite supportive.

GBP/USD Video 12.08.21

Breaking down below the 1.37 level could open up the possibility of a move down towards the 1.35 handle, which is even more supportive from a longer-term standpoint. On the other hand, if we were to turn around to break above the 50 day EMA then it opens up the possibility of a move towards the 1.40 handle, which has been important multiple times in the past and therefore will attract a lot of attention. If we were to break above the 1.40 handle, then I think it is likely that the market could go looking towards the 1.42 handle bone, which has been very difficult to overcome over the last several months.

One thing I think you should probably pay close attention to would be the interest rates in the United States, because if they continue to climb then that will more than likely put downward pressure on this pair solely based upon the US dollar than anything else.

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