GBP to USD Forecast – British Pound Continues to Suffer

Christopher Lewis
Published: Feb 7, 2023, 14:23 UTC

The British pound has continued to fall during the trading session on Tuesday, as we wait for the Jerome Powell speech later in the day.

British Pound, FX Empire

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GBP to USD Forecast Video for 08.02.23

British Pound vs US Dollar Technical Analysis

The British pound has initially tried to rally during the trading session on Tuesday, but then rolled over to show signs of weakness yet again. Ultimately, I think this is a situation where you have to look at this through the prism of a market that is definitely struggling, and that is possibly forming a major “M pattern.” The measured move of this pattern suggests that we could go down to the 1.1550 area, and I think at this point it’s not a real stretch to see that happen.

If we do rally from here, I suspect that there will be plenty of sellers out there waiting near the moving averages, but that’s assuming that we get any strength whatsoever. With Jerome Powell speaking later in the day, one would have to assume that he will retain his hawkish behavior, and therefore it should continue to show signs of US dollar strength in general. Ultimately, I do think that this market is going to do everything it can to break through that support near the 1.1870 level, and once it does I would anticipate seeing even more momentum.

That being said, it does not necessarily mean that it has to be a straight line down. However, it’s worth noting that the British pound has been one of the weakest currencies out there, and therefore it’s not just against the US dollar that I’m basing this analysis on. Take a look at the GBP/CHF pair, it will show you the same thing. Ultimately, this is a market that I think has much further to go, so I will be looking at rallies as potential selling opportunities.

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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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