GBP to USD Forecast – British Pound Gives Up Early Gains

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Published: May 4, 2023, 13:52 UTC

The British pound continues to see resistance just above, as we have seen the British pound give up some of its early gain for the session.

GBP to USD Forecast Video for 05.05.23

British Pound vs US Dollar Technical Analysis

The British pound initially tried to rally during the trading session on Thursday, breaking above the 1.2550 level, before turning around and pulling back again. Alternatively, this is a situation where we are trying to break out of a consolidation region, but we continue to see a lot of concern in general. After all, although the United Kingdom continues to see massive amounts of inflation, there are also concerns when it comes to the global growth situation.

If we were to break down below the bottom of the candlestick for the trading session on Thursday, then we could go looking to reach in the middle of the overall consolidation area. Keep in mind that the 1.2350 level underneath is the bottom of the overall range, with the 50-Day EMA backing it up. Ultimately, this is a market that continues to see a lot of volatility, but we are squeezing to the upside. That being said, it’s been very ugly on the way up, therefore I think it’s a situation that the market has to deal with a lot of noise out there and a lot of risk appetite concerns, so therefore I think even if we do break out to the upside it may be more or less a grind than anything else.

On the other hand, if we were to break down below the 50-Day EMA, which is also at the 1.2350 level, then we could open up and move down to the 200-Day EMA. Alternatively, on a move to the upside it’s likely that the market would reach the 1.2750 level, and then the 1.30 level. Either way, the market will continue to be very choppy and volatile, so you will have to be able to deal with a lot of volatility and uncertainty. One of the easiest ways you can do this is to keep your position size reasonable and look for signs of trouble to bail out of the market as quickly as you can. Being nimble and small with your position size will be one of the best things you can do.

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About the Author

Christopher Lewisauthor

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.