- During my daily analysis of major currency pairs, the GBP/USD seems to be showing a lot of the same attributes that I am seeing in various large currency pairs at the moment.
- After all, it looks like the markets are simply looking for some fundamental catalysts to get moving.
- As they don’t have it quite yet, I think that we continue to bounce around in the same range that we have been in.
Technical Analysis
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At this point in time, the most obvious levels to watch will be the 1.2500 level above, and the 1.2350 level below. Ultimately, it’s also worth noting that the 50 Day EMA sits at the 1.25 level, so therefore I think it adds a little bit more weight to the resistance barrier. As things stand right now, it’s also worth noting that the market had been in a downtrend for some time, and despite the fact that we have seen a 400 point bounce from the lows, we have also seen sellers overwhelm buyers multiple times since then.
If we do break down, then I think the market goes looking to the 1.2250 level, followed by the 1.21 level. If we break up to higher levels, it’s really not until we clear the 1.26 level that we are free to go much higher. If that were the case, then I think we could be looking at the 1.2750 level, or perhaps even the 200 Day EMA above. All things being equal, I think GBP/USD is a market that will continue to be very choppy and I think you’ve got a situation where you need to look at this through the prism of trying to trade back and forth in a range bound market with a little bit more of a downward bias than anything else. After all, the market had been negative for quite some time and at the margins, it does not seem as if the fundamental analysis has changed much.
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