GBP/USD Price Forecast – British pound rallied significantly to test resistance

The British pound has rallied significantly during the trading session on Wednesday, reaching towards the psychologically important 1.2250 level. That is an area that continues to attract a lot of attention, and beyond that we also have the 50 day EMA slicing through it. With that being the case, I think that there will be plenty of selling opportunities above, and at the first signs of exhaustion I am more than willing to short this market. Ultimately, I think that we reach back down towards the 1.20 level. With that being the case, it’s likely that we will continue a downward move.

GBP/USD Video 05.09.19

If we did break above the 50 day EMA, then we could go as high as the 1.25 level, which I think will offer rather significant resistance. A break above there could change the entire outlook for this market, but in the meantime I still prefer to fade rallies as the one thing we can count on with the British pound and of course the Brexit is that there is going to be plenty of negative headlines that come in and cause issues. With that being the case I am looking to short this market, and therefore aim for the 1.20 level. A break down below there unwinds down to the 1.18 level, and then perhaps the 1.15 level after that. All things being equal, I continue to fade rallies and look for signs of exhaustion to take advantage of as the US dollar is one of the bigger and better performing currencies.

Please let us know what you think in the comments below