British Pound vs US Dollar Technical Analysis
The British pound initially tried to rally a bit during the trading session on Wednesday but gave back gains rather quickly to continue to move down to the one area. This is an area that will attract a lot of attention, as it is a large, round, psychologically significant figure, and a relatively important historic area as well. Keep in mind that the British pound is being beaten up because the Bank of England has suggested that it was not going to sell off its portfolio.
With that being said, the Bank of England is “less hawkish” than the Federal Reserve, and this is what you are seeing play now. It also suppresses yields in the bond market in the UK, which is another reason to think that perhaps we are going to continue to go lower. At this point in time, I believe that any rally looks more likely to find sellers at the first signs of exhaustion than anything else.
If we break it down below the one handle, then it is very possible that the British pound plunges even more rapidly. We are oversold at this point, so I would anticipate that there should be a little bit of a bounce, but I would not be a buyer, even if you told me that you knew with 100% certainty that the market was going to go higher.
Every time we reach a handle above, I will be looking for signs of exhaustion to start selling. In other words, the 1.26 level, the 1.27 level, and so on. As far as buying is concerned, we need to recapture the 1.30 level or see a complete shift in the attitude of the Federal Reserve.
GBP/USD Price Forecast Video 28.04.22
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This article was originally posted on FX Empire
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