[DAILY NOTION] FXEMPIRE - GBP/USD Forecast - Oct 22, 2020

Chart: FXEMPIRE

The British pound has rallied early during the trading session on Wednesday, reaching towards the crucial 1.31 handle. The question now is whether or not it can sustain the move? If it can, and perhaps break above the 1.31 level on a daily close, the market is likely to go looking towards the 1.33 handle next.

However, we still have the same jitters that we have had forever when it comes to Brexit and all things involved in that mass, so it is not too difficult to imagine a scenario where somebody says something that has the market selling off again.

Occam’s razor dictates that all things being equal we should see the most logical outcome, and right now it looks like we will eventually try to break out to the upside but in the short term consolidation is what I have to assume.

What's Next?

To the downside, the 1.2850 level has offered significant support as of late, so unless there is some type of event in the financial world, I anticipate that we should stay above there. If we do break down below there, then the next target will almost certainly be the 200-day exponential moving average (EMA) which is closer to the 1.2750 level underneath.

Source: https://www.fxempire.com/forec...