GBP/USD Price Forecast – British Pound Gives Up Early GainsThe British pound has initially tried to rally during the trading session on Wednesday but continues to find resistance above the 1.23 level. Having said that, we have not broken through the “trapdoor” that I am looking for to happen in order to short this from a longer-term standpoint.
The British pound rallied a bit during the trading session on Wednesday, breaking above the 1.23 level but gave up those gains rather rapidly. As Jerome Powell speaks in front of a live audience via webinar, it has thrown the US dollar around a bit, but quite frankly this is a British pound that looks like it is running out of momentum anyway, so I do think that it is only a matter of time before it breaks down. The lack of momentum has been quite stark over the last couple of months, and quite frankly it is only a matter of time before we break down from what I can see. I am more than willing to fade rallies going forward, especially near the 50 day EMA which is suddenly showing itself to be important. On the other hand, if we break down below that 1.2250 level, then I am more than willing to start shorting again.
GBP/USD Video 14.05.20
That is a doorway to reach towards the 1.20 level underneath, and then possibly the 1.1750 level underneath. Quite frankly, it is a bit surprising that the British pound has held up the way it has, but things are starting to come back into focus as to what the world is going to look like after the pandemic. The United Kingdom will be locked up much tighter than many other places, and of course has some of the worst infection and death rates in the European continent.