GBP/USD Price Forecast – British Pound Fails at Big Figure

The British pound has rallied initially during the trading session on Tuesday but gave back the gains as we approached the significant 1.25 handle. By doing so it shows that the market is likely to continue seeing selling given enough time. After all, the UK economy has a whole list of issues that the United States economy seems to be able to skirt, and of course United Kingdom is going to reopen much later than the American economy.

GBP/USD Video 29.04.20

At this point, this is simply the 50 day EMA coming into the area as well, so I like the idea of shorting this pair, but I also recognize that it will probably continue to be very choppy in general. Ultimately, I do believe in the idea of fading short-term rallies until we can break above the recent high on a daily close. The US dollar is getting a bit of a bid beyond the British pound, simply due to the fact that the US Treasury market continues to attract a lot of inflows as well. A break down below the candlestick for the trading session on Tuesday opens up the possibility of a move down to the 1.2250 level given enough time.

If we break down below that level it is likely that we could go looking towards the 1.20 level, which of course has its own psychological significance built into it. Pay attention to risk appetite, because if it starts to fall apart, it is likely that the market will try to hoard US dollars yet again, which is its normal behavior.