British Pound Slices Through Major Support During the Week
British Pound vs US Dollar Weekly Technical Analysis
The British pound has broken significantly to the downside during the course of the week, slicing through the 1.25 level. By doing so, it is a very negative turn of events, and it looks as if the market is going to more likely than not continue to find plenty of sellers. I do believe that it is only a matter of time before short-term traders come in and start selling again. Signs of exhaustion will be jumped upon, as the US dollar is without a doubt the currency that everybody wants. The Bank of England has suggested that the United Kingdom will enter a recession, so this has added even more pressure to the pound.
Any break above the 1.25 level will more than likely attract sellers, but we could just simply slice through the bottom of the candlestick for the week. If we do, then it is likely that we go looking to reach the 1.20 handle relatively soon. The 50 Week EMA is starting to cross below the 20 Week EMA, which is also a very negative turn of events.
Ultimately, this is a situation where you have to favor the US dollar against the British pound because quite frankly it is continuing to be like a wrecking ball against everything it touches. Given enough time, the British pound looks as if it is ready to go lower but we are probably a little oversold in the short term. Another thing to pay attention to is the size of the last three candlesticks, so it certainly shows momentum.
GBP/USD Price Forecast Video 09.05.22
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This article was originally posted on FX Empire
