GBP/USD Price Forecast – British Pound Pulls Back From Same Resistance

The British pound has fallen rather hard during the trading session on Friday from the 1.42 handle, an area that I thought would be resistive. However, the Thursday candlestick closing at the very top of the range suggested that perhaps we are ready to take off, but that has clearly been rebuked during the session and now it looks like we are continuing to stick to this consolidation region.

GBP/USD

At this point, it still the same trade, if we can break above the 1.4230 level, then it is likely that we will continue to break out to the upside and go looking towards the 1.45 handle. All things being equal, this is a market that should continue to see a lot of noise, but at this point in time I think that you cannot be a seller, because we have worked so hard to get here that it is obvious there are a lot of people trying to get this market going to the upside.

The 50 day EMA currently sits at the 1.40 level, which is an area that I think will be a major support level. It is a large, round, psychologically significant figure, and an area that we had seen a significant break out from. With that being the case, I like the idea of using it as a springboard, assuming we even get down there. All things been equal, if we can break above that 1.4230 level, I anticipate that the market would go higher and probably rather quickly. At that point, I think it would be a situation where everybody starts to pile in.