GBP/USD Price Forecast – The British Pound Pulls Back From a Large Round Number

Christopher Lewis
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British Pound vs US Dollar Technical Analysis

The British pound has pulled back just a bit during the course of the session on Wednesday as the 1.25 level has offered a significant amount of resistance. There is a lot of noise out there, but it should be noted that the market is very negative in general, so therefore it is very important to remember that as we do get these occasional bounces.

Signs of exhaustion will be jumped upon, and it should be noted that even though we bounced quite nicely, we have been so bearish over the last several weeks that we were due for this type of bounce. Ultimately, signs of exhaustion that manifest near the 1.25 level and the 1.26 level will be opportunities to get short. The 50 Day EMA is near the 1.2750 and dropping rather rapidly. All things being equal, it is very unlikely that this market changes its overall attitude anytime soon. Beyond that, then we have the 1.30 level where the market had broken down from. That would be the absolute “ceiling” in the market right now.

On the downside, the 1.22 level has been short-term support, but you can also make an argument of the market forming a bearish candlestick, and now we are retesting the area. Based upon that measured move, we could look to reach the 1.20 handle, which I think is a reasonable target given enough time. There will of course be volatility as per usual, but a little bit of money management and position sizing will be paramount, but ultimately this is a situation where it is almost impossible to be a buyer.

GBP/USD Price Forecast Video 19.05.22

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This article was originally posted on FX Empire

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