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GBP/USD Price Forecast – British Pound Continues to Look for Support at Huge Level

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·2 min read
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The British pound has gone back and forth during the course of the session on Thursday as we are trying to retest the previous resistance barrier in the form of the 1.40 handle. That is an area that was not only a large, round, psychologically significant barrier, but an area where we had seen a rather significant break out previously. Ultimately, this is a market that looks as if it is trying to get to the 1.42 handle above, which was the area that had previously been so resistant. The fact that we were pulling back from the highs makes quite a bit of sense, because we had gotten there a bit too quickly.

GBP/USD Video 14.05.21

The 50 day EMA is starting to curl higher underneath, it should be a bit of support from a psychological and dynamic point a view. The British pound has been very strong during the course of the last year and ½ or so, with the exception of the recent consolidation. However, that consolidation is necessary when you have such a huge move to the upside. With that in mind, I like the idea of looking for value on this pullback and will be looking to get long again. If we can break above the 1.42 level, then I would add to a position as we almost certainly will go looking towards the 1.45 handle which I think is the longer-term target by the end of the year. Granted, this is going to be a very noisy affair so what will be paramount is position sizing more than anything else.

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

This article was originally posted on FX Empire

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