GBP/USD Forecast – British Pound Plunges

GBP/USD Forecast Video for 22.09.23

British Pound vs US Dollar Technical Analysis

The British pound has fallen pretty hard during the trading session on Thursday, as the Bank of England has held tight with its monetary policy statement and decision. Because of this, I think the British pound may be in serious trouble, especially if we continue to see a lot of fear out there going forward. After all, if the Bank of England sees enough concerns in the UK not to raise rates, and of course everybody in the world expected them to, that catches a lot of the market offside.

Ultimately, this is a market that has been breaking down for a while, so now that we are significantly below the 1.2350 level, it would not be a surprise at all to see this market drop down to the 1.20 level. Rallies at this point in time should continue to be selling opportunities, and I will fade signs of weakness. Yes, we may be a little overdone, and I would prefer a little bit of a bounce toward the 1.2350 level, but we can only trade what we are offered.

If we were to break above the 1.24 level, then you can start to have an argument about whether or not we are going to see an attempt to break toward the 200-Day EMA, but at this point it doesn’t look very likely that we are going to be able to do that, unless of course there is something coming out of the United States that would be a surprise. With both of the central banks standing still, there has been a shock due to the fact that the British weren’t supposed to be so and quite frankly, the voting pattern of the members showed just how indecisive the British were.

At this point, I like the idea of taking advantage of “cheap US dollars”, because it’s become obvious that traders out there are looking to get involved in on those greenbacks. Interest rates in America continue to climb, and that of course is a big deal for the currency markets. With this, I think if we break down below the bottom of the candlestick for the day on Thursday, we really could start to see an acceleration to the downside.

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