GBP/USD Weekly Price Forecast – The British Pound Plunges Lower

British Pound vs US Dollar Weekly Technical Analysis

The British pound plunged during the trading week to crush the 1.20 level. The 1.20 level is a large, round, psychologically significant figure, and therefore I think it continues to show quite a bit of weakness, therefore it’s likely that we continue to see downward pressure. That being said, we are a bit oversold, so I think that any rally at this point in time should show signs of exhaustion that we can get involved in. At that point, I think this is a market that we continue to see a lot of volatility in, but at this point, it’s likely that the market will continue to see more of a “fade the rally” type of situation.

It’s not until we break above the 1.26 level that I would consider this trend reversed, but as long as the Federal Reserve is going to be forced to tighten monetary policy, makes quite a bit of sense of the US dollar continues to strengthen. Any rally at this point in time will be looked at with suspicion, and as soon as we start to see the exhaustion on the daily chart, I will probably short this market.

That being said, we are pretty overdone, but ultimately, I think this is an area that screams overdone, so at this point, a little bit of patience may go a long way. I don’t like trading against the trend, so even if you told me that we were going to bounce, I have no interest in trying to get long. Expect a little bit of volatility, but you should also pay attention to the 10 year yield in the United States, because if it starts to climb again that could be very strong for the greenback as well.

GBP/USD Price Forecast Video for the Week of 18.07.22

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