GBP/USD Forecast – British Pound Continues to Plow Lower
GBP/USD Forecast Video for 27.09.23
British Pound vs US Dollar Technical Analysis
The British pound has fallen again during the trading session on Tuesday, as it looks like we are going to continue to see a lot of negativity. At this point, the market is likely to continue to see a lot of back-and-forth, and I do think that short-term rallies will probably continue to be selling opportunities in a market that looks completely broken, and ready to plunge toward the 1.1850 level before it is all said and done. Ultimately, rallies at this point will continue to be sold into at the first signs of exhaustion, and it looks at this point as the 1.2350 level is going to offer a bit of a barrier. That’s an area that I think will be almost impossible to get above any time soon, at least not without the Federal Reserve changing its overall attitude or the Bank of England suddenly worrying about inflation again.
Ultimately, a lot of concerns now are being seen in the British pound due to the fact that traders are worried about whether or not the European Union could drag the UK down into a recession right along with it. The downtrend is brutal at this point, and it is most certainly a bit of a runaway trade, but at this point, I think any rally looks as if it is going to be sold immediately, due to the fact that a lot of traders will not believe in that change without some type of major shift in central bank attitude and behaviors. Because of this, I think you will continue to look at this as a market that has somewhere to be, and that is most certainly going to be much lower than we are right now.
In fact, we are getting close to seeing a “death cross”, when the 50-Day EMA comes into the picture and drops below the 200-Day EMA, which is typically a very negative technical signal, and a lot of traders look at that as the beginning of a major downtrend just waiting to happen. At this point, I have no interest in buying the British pound against the US dollar, and the US dollar itself is by far the favorite currency to own when it comes to the Forex markets.
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