GBP/USD Forecast – British Pound Looking for Buyers

GBP/USD Forecast Video for 08.09.23

British Pound vs US Dollar Technical Analysis

The British pound has fallen a bit during the early hours on Thursday, but it does look as if we are trying to do everything we can to hang on to the overall uptrend. Pay close attention to the 200-Day EMA, because it has a major influence on longer-term traders and therefore on what happens with the overall trend. If we break above the top of the candlestick for the trading session on Thursday, then it’s likely that we could go to the 1.2650 level, which is also an area where you would see the 50-Day EMA offer a little bit of resistance.

The question now is whether or not we can recapture the uptrend line, but if we break down below the bottom of the candlestick for Thursday, then it opens up the move down to the 1.2350 level. The 1.2350 level is an area that a lot of people pay close attention to, due to the fact that it has previously been important a couple of different times. Breaking below that level could open up a massive amount of selling, but at this point it seems very unlikely that happens anytime soon. All things being equal, this is a market that looks very soft, and therefore I think you continue to look at rallies with a bit of suspicion, but if we were to break above the 1.2650 level, then it’s likely that we could go higher.

That being said, keep in mind that both central banks may have to soften monetary policy down the road, and that could cause more noise than anything else. With this, I think you’ve got to look at this through the prism of volatility and short-term trading more than anything else, as longer-term trends are still being sorted out, something that retail traders have no influence on. Position sizing will be very crucial, and therefore you need to be cognizant of the fact that the only thing you can do is protect the amount of risk you take in a volatile situation we find ourselves at the moment, not only in the British pound, but multiple other markets as well.

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