GBP to USD Forecast – British Pound Slams Into Resistance

GBP to USD Forecast Video for 13.03.23

British Pound vs US Dollar Technical Analysis

The British pound has rallied significantly during the trading session on Friday to break above the 1.20 level and test the 50-Day EMA. By doing so, the market looks as if it is going to be a decent selling opportunity. I will be looking at short-term charts for signs of exhaustion that I can get short on, as the recent bounce has been somewhat important, but the economy is starting to show serious signs of cracking around the world, and that will draw up the value of the US dollar eventually.

After the 50-Day EMA, we have the 200-Day EMA, which comes into the picture as well. The market breaking above the 200-Day EMA opens up the possibility of a run to the top of a shooting star which is right around the 1.23 level, and then eventually we could go as high as 1.24 if we really take off. I don’t see that happening anytime soon, due to the fact that the fear out there is somewhat palpable, as we have seen quite a bit of negative headlines out there including inflation, trouble in some of the banks in the United States, and of course supply chain issues, and even geopolitical concerns.

At this point, I will be fading the British pound and am not interested in buying it, but I also recognize that it might be a situation where we need to do something on Monday, as to the Friday actually intends to be very noisy anyway, and then adding a jobs report on top of it makes it so much worse. The size of the candlestick of course is somewhat important, but the fact that we are heading into quite a bit of noise also suggests that it would take very little to push this market back down.

Jerome Powell has reiterated his need and desire to raise interest rates this week, and the jobs report probably won’t do much to change that. Furthermore, he also suggested that perhaps interest rate hikes may be quicker than anticipated, so one would have to think that eventually the US dollar should get a little bit of abuse due to that.

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