GBP/USD Price Forecast – British Pound Struggling Against Greenback

The British pound has gone back and forth during the trading session on Friday as we continue to see a lot of confusion when it comes to risk appetite, and quite frankly the most important thing is that we are starting to see signs of exhaustion on every rally. To the downside, the 1.23 level seems to be rather supportive, so if we were to break down below there, I would anticipate that the British pound would accelerate to the downside. At this point, it could open up a move down towards the 1.20 level, but I do not necessarily expect to see that happen overnight.

GBP/USD Video 27.04.20

All things being equal, the United Kingdom is going to be locked down much longer than the United States, and that in and of itself should continue to put a bit of negativity on Sterling. Ultimately, I believe that the British pound is a currency that is going to be hit not only by that, but also the fact that we are now starting to hear that Boris Johnson didn’t attend coronavirus meetings, which could cause a lot of political blowback, something that the United Kingdom seems to be prone to these days. Oh, and let us not forget the Brexit situation that is still waiting out there. Had other words, the United Kingdom has a lot of work to do and the outlook for the UK in the short term is not anywhere near as strong as this recent rally had suggested. The 61.8% Fibonacci retracement level at the 1.25 level seems to be a significant ceiling in this market.