GBP/USD Weekly Price Forecast – British Pound Stabilizes

The British pound has gone back and forth during the course of the week, as we continue to hover right around the 1.32 handle. The 1.32 handle has been important in the past, so it is not a huge surprise to see that a little bit of stability has come back into the picture. That being said, the market is likely to see a bit of a short-term bounce, which I think will ultimately produce a potential selling opportunity. I do not necessarily think that you can make that call quite yet, but I do think that the market is certainly going to be looking at the upside with the possibility of the 1.34 region offering resistance. I believe that resistance runs all the way to the 1.35 handle, so it is obvious that you have to be cautious in that area.

GBP/USD Video 13.12.21

That being said, if we were to break above the 1.35 handle, then the longer-term trend returns to the upside, and more likely than not would go looking towards the 1.42 handle. A breakdown below the bottom of the candlestick for the week could open up a move to the 1.30 handle, which breaking down below there would then of course be a very negative turn of events, possibly opening up a move much lower, maybe down to the 1.25 handle.

Keep in mind that the pair is somewhat risk sensitive, so if we get a sudden selloff, it could fall in line with the rest of the markets around the world showing the same thing. On the other hand, if the US dollar starts to fall apart, that may help lift the British pound eventually.

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