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GBP/USD Price Forecast – The British Pound Continues to Look Messy

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British Pound vs US Dollar Technical Analysis

The British pound initially fell during trading on Wednesday, after a couple of minor British numbers came out showing that inflation may continue to be a bit of an issue, only to turn around and bounce again. Ultimately, it looks like we are trying to find some type of short-term direction, but right now I don’t know that we have it.

With this in mind, I like the idea of waiting for signs of exhaustion after a rally to start shorting again, because of course that is the longer-term trend. If we break down below the bottom of the daily candlestick, that could open up and move down to the 1.20 level, something that I think happens again eventually.

However, it is probably worth noting that we could get a short-term rally. That rally could end up challenging the 1.25 level, where I see much more significant resistance, and the 50 Day EMA is attempting to breach below. Because of this, I think that would be an excellent place to start beating any type of exhaustion that you see, assuming that we can even get there.

Interest rate differentials will continue to favor the greenback, as the Federal Reserve has already promised 100 basis points of rate hikes over the next couple of meetings. While that is somewhat priced into the market, the question is what happens next, but it certainly does not look as if other central banks are going to be as aggressive as the Federal Reserve. Furthermore, there is a lot of talk about the possibility of global recession now, and if that’s the case, the US dollar does tend to perform well.

GBP/USD Price Forecast Video 23.06.22

For a look at all of today’s economic events, check out our economic calendar.

This article was originally posted on FX Empire

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