GBP/USD Price Forecast – British Pound Touches 50 Day EMA

The British pound initially tried to rally during the trading session on Friday but then gave back the gains after we got above the crucial 1.3750 level, and of course reached towards the 50 day EMA. As you can see, the 50 day EMA is starting to slope lower, but at this point in time I think this market is probably going to focus more on the US dollar than the British pound itself. After all, the greenback has been very strong against multiple currencies, so this market probably will not be any different.

GBP/USD Video 29.03.21

If we were to break above the 50 day EMA, then it is possible that we could go as high as 1.40, an area where we have seen a lot of selling pressure previously. Because of this, I think that the upside is somewhat limited in the short term, but I also could say the same thing about the downside. After all, there has been significant noise between the 1.3750 level, and the 1.35 level underneath that.

If we can break down and crash through the most recent low, that does open up a move towards 1.35 handle, but I think that level will be difficult to overcome for the sellers. The 200 day EMA is starting to race towards that level, so it does make a certain amount of sense that we would see more technical support there as well. This is a market that is very bullish overall, and even though we have pulled back the way we have from here, the reality is that it is still a relatively small move against what has been extraordinarily bullish action over the last several months.

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