GBP/USD Price Forecast – British Pound Reaches Top of Consolidation Range

The British pound has rallied significantly during the course of the trading session on Wednesday to reach towards the 1.3325 handle. The market is getting dangerously close to the top of the overall consolidation area, so it does make a certain amount of sense that we could be looking for exhaustion. We do not have that yet, but it certainly looks as if we are getting to an area where we should start seeing the potential of exhaustion. At this point in time, the 50 day EMA is starting to race down towards it as well, so that of course could cause some type of resistance as well.

GBP/USD Video 23.12.21

The market falling from here will see plenty of support near the 1.32 level, and at this point in time I assume that we are sitting in this consolidation between now and the end of the year. That being said, if we do break above the 1.3350 level, then we may have the ability to go much higher. I do not necessarily think that it will be a longer-term move, but at this point anything is possible. Keep in mind that the liquidity is going to be a major issue, so pay close attention to your position size, because you could see a sudden move based upon illiquid markets. All things being equal, I fully anticipate sideways markets but To be very cautious this time a year. In fact, I typically use about 1/3 my normal position size just to be safe. The last thing you want is some type of massive loss in the year.

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