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GBP to USD Forecast – British Pound Continues to Consolidate

By:
Christopher Lewis
Published: Nov 30, 2022, 14:13 UTC

The British pound has initially rallied during the trading session on Tuesday to reach above the 1.20 level, but it’s obvious that the market is running out of momentum at this point.

British Pound FX Empire

In this article:

GBP to USD Forecast Video for 01.12.22

British Pound vs US Dollar Technical Analysis

The British pound has rallied initially during the trading session on Tuesday but continues to struggle with a 1.20 level. At this point, we also need to pay close attention to the idea of the 200-Day EMA sitting just above, because it could cause a bit of psychological resistance. Furthermore, we also have seen a lot of noise in this area previously and of course we have the 50% Fibonacci level. All things being equal, between the psychology and the technical signals, it does not surprise me at all that the pound is struggling here.

On the fundamental side, we have to worry about the Core PCE numbers coming out on Thursday, as well as Jerome Powell speaking during the day on Wednesday. After that, we have the Non-Farm Payroll announcement coming out on Friday, so having said that, it’s likely that we have seen the short term highs. If we break down below the 1.19 level, then it could open up the possibility of a move to the 1.18 level. After that, then you have a clear path down to the 50-Day EMA. Ultimately, that is what I suspect will happen, but it may take some time to happen. However, this week certainly could kick off the fireworks us in this market lower.

On the other side of the equation, if we can break above the 1.2250 level, then it’s possible that we could go much higher, perhaps reaching to the 1.25 level. That will more likely than not have a lot to do with the numbers suggesting that perhaps the US is slowing down and that the Fed will have to shift gears. I wouldn’t hold my breath.

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

About the Author

Being FXEmpire’s analyst since the early days of the website, Chris has over 20 years of experience across various markets and assets – currencies, indices, and commodities. He is a proprietary trader as well trading institutional accounts.

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