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GBP/USD Price Forecast – British Pound Continues to Slump Lower

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The British pound has fallen a bit during the trading session on Friday, reaching down to the 1.3250 level. There is a lot of support underneath in that general vicinity, and therefore I think a does make a certain amount of sense that we continue to struggle. However, if we were to break down below the massive hammer on Tuesday, it opens up massive selling down to the 1.30 handle. The 1.30 handle of course is a large, round, psychologically significant figure, and will attract a lot of attention.

GBP/USD Video 06.12.21

Rallies at this point still continue to struggle with the idea of 1.3350 handle, which is an area that has been difficult to break above over the last couple of weeks. I think that is your short-term “ceiling in the market”, so people need to pay close attention to how the market behaves once we get there. If we were to break above all of these wicks, then we probably get a move towards the 1.35 handle. The 1.35 handle of course is a large, round, psychologically significant figure that a lot of people would look at as potential barrier. Adding more credence to that idea is the fact that the 50 day EMA is reaching towards it, and therefore it is likely that we would see technical traders see that as difficult to get beyond it as well.

Either way, as things stand right now, I prefer to fade rallies that show signs of exhaustion, something that will occur more than once over the next several days. I think at this point in time, the US dollar still remains king.

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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