The British pound has rallied again during the trading session on Wednesday as we continue to see the 1.42 level offer a significant amount of resistance. That is an area where we have seen the market try to break above there but then pulled back multiple times, as we are building up the inertia to go higher. The highs from the previous week being broken allows the market to go looking towards 1.45 handle. That is an area that I believe would be a significant round figure that a lot of people would pay close attention to.
GBP/USD Video 10.06.21
When you look at the chart, you can see that the 50 day EMA has been rising for a while, and therefore it should continue to be somewhat supportive as well, as the 50 day EMA is a technical indicator that a lot of people will pay attention to. That being said, I do not have any interest in shorting, and I do believe that the 1.41 handle is support, just as the 1.40 level is. That being said, I think that a lot of value hunters would come into the picture at that point.
The British pound continues to get a bit of a push higher due to the fact that the UK economy is opening up, and of course United States seems hell-bent on spending as much money as possible through various types of stimulus. As long that is going to be the case and yields in America continue to drift a little bit lower, it is likely that we continue to see the upward momentum chip away at resistance.
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