GBP/USD Price Forecast – British Pound Levitates Near 50 day EMA

The British pound went back and forth during an incredibly quiet session on Friday as the United States was a way celebrating the observed Independence Day holiday. With that, there would have been a lack of volume from about half of the world’s largest banks, so obviously the currency markets did not offer much. That being said, we formed a massive shooting star on Thursday, and that does in fact suggest that we are going to pull back.

At this point, I would need to see the market take out the lows from the Friday session in order to get excited, and then at that point I think we go and revisit the 1.23 level. On the other hand, if we were to break above the top of the shooting star from the Thursday session, that would in theory at least be a strong sign. At that point, we could go looking towards the 200 day EMA.

GBP/USD Video 06.07.20

The area between the 50 day EMA and the 200 day EMA is quite often thought of as a barrier of support or resistance, so at this point I would not be surprised at all to see this market pull back a bit. However, when you look at the longer-term chart it is obvious that we have formed a “higher low”, so that is something to pay attention to. Despite Brexit, despite the fact that the UK economy is on its back feet, the reality is that the Federal Reserve is doing everything you can to kill the US dollar, so the markets may be willing to oblige them.

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