- The British pound remains choppy on Friday, as we are stuck between the 50-day EMA and the 200-day EMA indicators. With this, the market remains a short-term situation form what I see at the moment.
British Pound Remains Range-Bound Amid Shifting Market Signals
The British pound has gone back and forth during the course of the trading session on Friday as we continue to test the 50-day EMA and, of course, a couple of other levels including the 200-day EMA.
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The 1.35 level above is a major barrier that I think will continue to offer a bit of a ceiling. If we can break above there, then we could go looking to the 1.36 level. This, of course, will be highly influenced by the idea of what is going on with the US 10-year yield, and that has been drifting a little bit lower over the last couple of days, but it's bounced a bit later in the day, and that explains why the pound dropped.
Technical Support Levels and Market Outlook
If we were to break down below the hammer from the Thursday level and the bottom of the Thursday candlestick, it could open up a move down to the 1.33 level.
Ultimately, I expect a lot of noisy behavior, but I also recognize that this is mainly about the US dollar in general. With that, I am very cautious about putting a ton of money into the market, but I also recognize that the range can be played. You just have to be looking for the outer part of the range to either buy or sell.
Now, obviously, we will break out in one direction or the other, and once we do, we could start to look for bigger, longer-term moves, but that probably demands some type of major shift in the bond markets.
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