GBP/USD Weekly Price Forecast – British Pound Continues to Look Healthy

The British pound has initially fallen during the course of the week, breaking back below the 1.35 handle. However, we have seen buyers come back in and pick this market up, and therefore it looks as if we are ready to continue going higher. This is interesting, considering that the market favors the US dollar in general, with the exception of the British pound right now. If we can break above the top of the candlestick for the week, that does suggest that the British pound is probably going to go looking towards the 1.37 level above. That is an area where we had seen fairly significant selling previously, so it does make a certain amount of sense.

GBP/USD Video 10.01.22

Ironically, it is not until we break above there that the actual trend changes. Yes, we had been in a longer-term uptrend, but this pullback that we have had has been rather vicious, so I am not necessarily willing to jump in with both feet at the moment, due to the fact that the area above could signify a lot of trouble.

All things being equal, what I would anticipate is that we will see a lot of back and forth and choppy behavior, and I would also say that if we were to break down below the bottom of the candlestick for the week, that would almost certainly send this pair much lower, perhaps reaching towards 1.32 level underneath which had offered support. While this is a strong candlestick for the week, it could also very quickly turn into a “hanging man” if we were to break down below it. The next week or two should be crucial.

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