GBP/USD Forecast – British Pound Gets Hammered

GBP/USD Forecast Video for 24.08.23

British Pound vs US Dollar Technical Analysis

The British pound has seen a certain amount of negativity over the last 24 hours, specifically after the PMI numbers in the United Kingdom came out much lighter than anticipated. In fact, both of them are contractionary, so now people are running toward the US dollar. That being said, it’s worth noting that the PMI numbers in the United States have yet to be released, and if they are equally as miserable, we could see a complete turnaround.

That being said, we are also between the 50-Day EMA in the 200-Day EMA indicators, which in itself can cause quite a bit of noisy behavior. All things being equal, this is a market that I think continues to see a lot of noisy behavior, with the Jackson Hole Symposium speech is coming out on Friday. This of course will have a major influence on what happens next, and of course people out there are looking toward the tone of the Jerome Powell speech. If the Chairman of the Federal Reserve strikes a hawkish tone, that obviously will be strong for the US dollar, but it seems like people out there are trying to not believe him any chance they get. Regardless, I think what we are looking at is a market that simply in a bit of a holding pattern, despite the fact that we have seen a significant selloff early during the Wednesday session.

Underneath, we also have a major uptrend line, and therefore I think we’ve got a situation where there is so much support that is going to take something somewhat extraordinary to break this market down. If we do break down below the 200-Day EMA, then it’s likely that we continue to see a lot of negativity. Ultimately, if that were to happen you would probably see a huge run toward the US dollar overall, not just with the British pound. Ultimately, I think we have a situation where you have to look at this through the prism of whether or not we are going to get more of a value play, or if we are going to get some type of breakdown. The next several days could answer that question.

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