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GBP/USD Weekly Price Forecast – The British Pound Looking to Break Out

Christopher Lewis
·2 min read

The British pound pulled back a bit during the course of the week, but then turned around to break above the 1.36 handle. By doing so, it looks as if we are ready to go higher, and it is worth paying attention to the fact that the US dollar is losing its strength in general. If we can break down below the 88 handle in the US Dollar Index, that will be the death knell for the greenback, lease for the meantime. The candlestick does look very bullish in this pair, even though the British pound obviously has a lot of negativity around at the moment. This shows just how weak the US dollar is at the moment, and therefore I think the British pound will be lifted as a result.

GBP/USD Video 04.01.20

If we do break down from here, the 200 week EMA is near the 1.3150 level, and should offer a bit of a “floor in the market.” At this point in time, it is very likely that the British pound is going to go looking towards the 1.40 level over the next several months, and when you look at the longer-term charts, you can see that we have formed a major bottoming pattern and you could even make an argument for a very ugly inverted head and shoulders. Regardless, it looks as if stimulus in the United States is the only thing that people are paying attention to, and it is worth noting that the British pound is historically cheap at the moment. At this point, the market looks very bullish and should continue to.

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This article was originally posted on FX Empire

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