Yahoo Finance GBP to USD Forecast – British Pound Gives Up an Early Gain
GBP to USD Forecast Video for 30.05.23
British Pound vs US Dollar Technical Analysis
The British pound initially tried to rally during the trading session on Monday but gave back gains rather quickly as there was a serious lack of volume. After all, it was Memorial Day, and this means that there would’ve been a lack of excitement one way or the other. The 1.2350 level is an area that has been a bit of a magnet for price for some time, and the 50-Day EMA just above could offer a significant resistance barrier, just as the 200-Day EMA will offer significant support. As we are between these 2 indicators, it makes quite a bit of sense that we would see a little bit of hesitation. All things being equal, this is a situation where I think you got the likelihood of choppy behavior more than anything else.
If we break above the 50-Day EMA, then I think the market goes looking to the 1.2550 level, an area that has been important a couple of times in the past. On the other hand, if the market were to break down below the 200-Day EMA, then it’s possible that the British pound could drop down to the 1.1850 level. The 1.1850 is the gateway to much lower pricing, and quite frankly, I think if we were to retest that area, it’s possible that the US dollar would be like a wrecking ball that gets almost everything else as well.
The Fed is expected to raise rates in the future or at least stay tight. At the same time, Europe is heading into a recession, and that will almost certainly have an effect on Britain eventually. With that, the pound could struggle. However, if we were to break to a fresh, new high, then it’s likely that the British pound eventually goes looking to the 1.30 level above, which is a large, round, psychologically significant number, and a lot of people will pay close attention to whether or not we see sellers in that area. If we were to break above there, then the British pound will almost certainly end up being a “buy-and-hold” situation.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
