GBP to USD Forecast – British Pound Drops After Forming Shooting Star

GBP to USD Forecast Video for 27.03.23

British Pound vs US Dollar Technical Analysis

The British pound has fallen a bit during the trading session on Friday as we are reacting to the shooting star from the previous session. At this point, the market looks as if it is trying to test the 1.22 level, a large, round, psychologically significant figure that has been resistance previously, thereby offering a little bit of “market memory.” If we can break down below that area, then it opens up a move to test the 200-Day EMA, and then possibly even the 50-Day EMA.

On the other hand, if we turn around and break above the top of the shooting star, then we will test the 1.24 level, an area that has been very difficult for the British found multiple times in the past. In fact, there is a huge double top formed in that area, which I believe it kicks off significant resistance that extends to the 1.25 level. The 1.25 level is obviously a large, round, psychologically significant figure, so therefore it’s probably going to be an area that’s very difficult to get above. If we were to do that, it would obviously be a very bullish sign, and therefore open up a bigger move to the upside.

If we break down below the moving averages underneath, then the 1.20 level is a large, round, psychologically significant figure that a lot of people will be paying attention to, and it could offer a little bit of support. Breaking down below that then opens up a move down to the 1.1850 level, which is a major support level that has been tested several times. Anything below there would open up a huge move lower, perhaps down to the 1.15 level, and then down to the 1.10 level given enough time. With this being the case, the market will more likely than not continue to be more of a “run to the US dollar type of market.” At this point, it’s all about risk appetite, and that of course moves the US dollar more than anything else, and at the same time can be negative for the British pound if we do see a lot of concern out there.

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