The British pound has gone back and forth during the course of the trading session on Wednesday as we hang around the 1.39 handle. That is an area that continues to cause a bit of choppiness, and I think that is probably what we are going to see over the next 48 hours. After all, we have the Monetary Policy Committee meeting on Thursday and of course the jobs number on Friday. Ultimately, this is a market that will make a move, but right now it looks as if the 1.40 level above continues to be a massive barrier that the market simply struggles to get beyond. Looking at this chart, I think that we are simply killing time until we get some of those answers.
GBP/USD Video 06.05.21
Underneath, there is a little bit of a double bottom that the market will continue to pay close attention to, and if we were to break down below there then it is likely that the market goes looking towards the 1.35 handle underneath. That is an area where we see the 200 day EMA racing towards, so that should offer a significant amount of support as well. With that being the case, I like the idea of buying in that area if we do get down there, but I just do not see that happening in the short term. Longer-term, I think we are much more likely to break above the 1.40 handle, but that is going to take a significant amount of momentum to make that happen. With this in mind, I like the idea of going long, but I would either wait for a better price, or a breakout above the aforementioned 1.40 handle.
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