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GBP to USD Forecast – The British Pound Has Rallied Significantly

By:
Christopher Lewis
Published: May 30, 2023, 13:29 UTC

The British pound has rallied significantly from the 1.2350 level, showing signs of life again on Tuesday.

US Dollar, FX Empire

In this article:

GBP to USD Forecast Video for 31.05.23

British Pound vs US Dollar Technical Analysis

The British pound has bounced rather significantly during the trading session on Tuesday, as we have seen a lot of interest in this market during the day as the US dollar has fallen a bit during the day. Ultimately, we broke above the 50-Day EMA, and therefore it’s likely that we continue to see a little bit of upward pressure. Whether or not we breakout for a longer-term move remains to be seen, because there are lot of concerns out there when it comes to the global economic situation, which does help the United States dollar.

All that being said, it’ll be interesting to see how this plays out due to the fact that the markets course are going to be noisy with a lot of concern, and it’s also worth noting that we are heading into the consolidation area that we have been in for a while. In other words, this is simple back-and-forth trading yet again, with the 1.2350 level offering support, and the 1.2550 level offering resistance above. The 50-Day EMA of course attracts a lot of attention but whether or not we continue to see more sideways action, or whether or not we actually make a move.

At this point, I think it’s just going to be more range bound trading and therefore if you have a decent range bound trading system that you can employ, that might be the best way to go going forward, as it certainly looks like the markets don’t really know what they want to do anytime soon for a sustained move. However, if the market were to break down below the 200-Day EMA, it could open up a huge move down to the 1.1850 level over the longer term. In that situation, then I would become aggressively short of this pair, and therefore heavily short. A breakdown below the 1.1850 level would open up the trap door for a bear market. That being said, I think this is more or less going to be back and forth, and therefore you have to focus on the short-term charge, showing a lot of back-and-forth in general.

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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