GBP/USD Price Forecast – British Pound Roles Over

The British pound broke down a bit during the trading session on Tuesday, reaching towards 1.30 level. The 50 day EMA sits in that general vicinity and it looks like we are going to try to break down below there. If the market breaks down below the 1.30 level, then it’s possible that we start looking towards 1.29 level for support next. If that gives, then it’s likely that the 200 day EMA underneath will be targeted as the next support level which is currently near the 1.27 level.

GBP/USD Video 11.03.20

To the upside, if the 1.30 level hold as support, it’s likely that the market could bounce from here and try to get back towards the 1.32 handle. At this point, it’s very likely that the US Federal Reserve will have to do some type of interest-rate cut to calm down the markets, and that will bring the interest rate differential closer to each other with these currencies, and therefore the British pound will have to be priced at a higher level. The 1.35 level above is the longer-term target, but we need to get through the 1.32 level to begin with. It doesn’t mean that we get there overnight, just that it’s likely to reflect some type of repricing. That being said though, we are in a very tenuous situation globally right now so there could be a break down and run towards the greenback but all things being equal it certainly looks as if the buyers will probably try to support this pair.