GBP/USD Price Forecast – British Pound Pierces 200 Day EMA
The British pound has rallied again during the trading session on Thursday to break above the 200 day EMA and the 1.34 handle. We are now challenging the 1.3750 level above, and above there we could have a major move to the upside. The 1.3750 level has been an area of importance more than once, so therefore it is not a huge surprise to see that we have seen this yet again being tested. If we can break above this area, then it would be a very bullish sign and could open up the market to much bigger moves. The US dollar has been getting pummeled based upon inflation, and I think that is going to continue to be a headline risk.
GBP/USD Video 15.10.21
That being said, it is not until we break above the highs during the trading session on Thursday that we can go higher. Do not be surprised at all to see a bit of volatility and choppy behavior in this area, as we have seen it offer a lot of noise previously. The market had been forming a bit of a “death cross”, but unfortunately that signal is quite often a bit late, and therefore I think you need to keep in mind that the signal may have just faked a lot of people out. That being said, if we were to turn around a break down below the lows of the trading session on Thursday, that could send this market back down towards the 1.36 handle in a bit of consolidation.
That being said, the market is likely to see more upward pressure than down in the short term, but we are fighting a certain amount of resistance.
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