GBP to USD Forecast – British Pound Runs Into Resistance Barrier

GBP to USD Forecast Video for 12.04.23

British Pound vs US Dollar Technical Analysis

The British pound has rallied a bit during the trading session, as we continue to see a lot of noise above the 1.24 level. The market has attempted to break above there, but it also is starting to show signs of exhaustion. Ultimately, this is a situation where we are getting overbought, so there is the possibility that we pull back significantly. If we break down below the hammer from the Monday session, then the market is likely to go looking to reach the 50-Day EMA, and then possibly down to the 200-Day EMA.

The British pound course has been one of the better performing currencies around the world this year, so therefore it’s not a huge surprise to see that it is trying to break out. Whether or not it can remains to be seen, but at the very least we would need to see a daily close above the 1.25 level. If we get that, then it’s possible that the market is looking to the 1.2750 level above. That being said, we need to see some type of fundamental reason, or massive US dollar so often make that happen. While the US dollar has been sold off rather stringently as of late, it is oversold at this point.

Ultimately, this is a situation where the US dollar will be the main driver, so therefore it’s likely that we will continue to see a lot of volatility, as traders around the world continue to think about the questions of global growth, and of course whether or not safety will be crucial. The Federal Reserve is likely to continue raising interest rates at the next meeting in May, but the question is whether or not they keep raising after that. They are ready to deal with inflation, and therefore people are expecting the Bank of England to remain tight, but at the end of the day, the Federal Reserve has been screaming from the mountain tops that they are going to stay tight regardless. The question now is whether or not we are breaking out of the range that I have marked on the chart, or if we are simply at the top of the range and getting ready to pull back.

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