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Christopher Lewis
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Pound

The British pound has rallied a bit during the course of the trading session on Wednesday but gave back the gains just above the 1.40 level to continue showing a bit of hesitation. Nonetheless, this is a market that continues to see a lot of underlying upward pressure. That being said, it is likely that we will continue to see a lot of noise in general but at the end of the day we are in an uptrend and we only pulled back once we hit a major resistance barrier.

GBP/USD Video 4.03.21

That major resistance barrier was of course the 1.42 handle, an area that has been important more than once. After all, we had seen the weekly chart stop there before falling again, so I think given enough time we are going to attempt to break out above there. Whether or not we can is a completely different question of course but at the end of the day it is very likely we will continue to see the market build up pressure to finally make that move. If and when we can break above the 1.42 level it will simply continue the overall uptrend and drive the market towards the 1.45 handle in general.

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To the downside, I see a massive amount of support near the 1.3750 level, which is where we used to be resisted at, especially now that the 50 day EMA is starting to reach that area. There should be a lot of “market memory” in that general vicinity, so I think that a lot of people will be looking to get involved if and when we can get down there.

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

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