GBP/USD Forecast – British Pound Dips

GBP/USD Forecast Video for 15.09.23

British Pound vs US Dollar Technical Analysis

The British pound fell a bit during the trading session on Thursday, as we have seen a bit of a bounce from the lows, but quite frankly this is a market that still looks like it has some troubles ahead of it. With that being the case, think we’ve got a situation where the 1.2350 level underneath is the short-term floor of the market, and therefore I think you need to look at it through the prism of whether or not risk appetite is going to continue to favor taking risks, or if it’s going to be about safety. If markets continue to see a lot of trouble out there when it comes to the global economy, then it does make a lot of sense that the British pound will continue to struggle. Quite frankly, it does look like the US dollar is starting to strengthen overall, but we may get a short-term bounce.

If we were to take out the 200-Day EMA above, then it is possible that we can see a move much higher, perhaps to the 50-Day EMA which would be closer to the 1.2650 level. The 1.2650 level also features the 50-Day EMA, so therefore it all comes together quite nicely. Ultimately, I think there is a market to be made here of volatility and risk, and unfortunately, I think that probably continues to be the case.

If we were to break down below the 1.2350 level, then it’s likely that the British pound will continue to plunge, perhaps dropping down to the 1.20 level over the next several weeks. On the other hand, if we do break above the 1.2650 level, it would be a major shift in the attitude of the US dollar, and therefore the British pound would probably be a major beneficiary of this shift in attitude as traders would be looking to short the US dollar in general, especially if interest rates start to drop in America again. That being said, there is a huge push by the Federal Reserve to try to convince people that they are going to stay tighter for longer, and therefore it does make a certain amount of sense that we would see stagnation.

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