GBP/USD Price Forecast – British Pound Slams Into Short-Term Resistance

The British pound has rallied a bit during the course of the trading session on Friday to reach towards the 1.39 handle. This is an area where the market has seen sellers in the past, so it is not a huge surprise to see the market stall here. Nonetheless, I think this is a market that needs to figure out whether or not it can break through here, because if it does that would be an extraordinarily bullish sign. We have been all over the place as of late, with central banks around the world causing chaos. The lack of knowing what they are going to do has been a real issue for the markets, so we need to make sure that the breakout happens before putting money to work. If we do break above the 1.39 level, then the next obvious target would be the 1.40 handle.

GBP/USD Video 13.09.21

To the downside, the 50 day EMA could offer a bit of support, followed by the 200 day EMA. If and when that happens, I would anticipate value hunters coming into the picture. However, if we were to break down below the 1.37 level, that almost certainly have the market looking towards the double bottom at the 1.36 handle which opens up a massive amount of selling. As things stand right now, that seems to be very unlikely, so I do believe that we are probably simply going to sit here and wait for enough inertia to be built to the upside based upon what has happened over the last couple of days. Expect volatility if nothing else.

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