GBP/USD Weekly Price Forecast – British Pound Has Slow Week

The British pound initially tried to rally a bit during the course of the week but gave back the gains rather quickly as we continue to see a lot of noise based around the British pound due to the lock down in that country, and of course the mutant variation of the coronavirus. Nonetheless, we are trying to break out against the greenback, which makes quite a bit of sense considering that the United States is likely to do a massive amount of stimulus. As long as that is going to be the case, then it makes sense that we would see a lot of pressure against the greenback.

GBP/USD Video 11.01.21

From a historical standpoint, the British pound is of course cheap, but it looks to me like we are in fact trying to break out here, and I think that eventually the pound is going to go looking towards the 1.40 level above. That does not mean that is going to be easy, but clearly the pound is trying to do everything it can to break out. Dips should continue to find support near the 1.35 handle, and then again down at the 1.3350 level which is the scene of the 200 day EMA, followed by the 1.32 level which is roughly where the 200 week EMA is sitting. The fundamentals for the United Kingdom are better in the sense that at least Brexit is done, and of course has been the big anchor to this currency for ages. I have no interest in shorting this pair anytime soon.

For a look at all of today’s economic events, check out our economic calendar.