Deepening Bearish Sentiment in Natural Gas Takes it to New Lows

Natural Gas Forecast Video for 06.02.23 by Bruce Powers

Natural gas reached a new low of 2.34 Friday as bearish sentiment prevailed as it has for many weeks. The 88.6% Fibonacci retracement at 2.42 was exceeded to the downside with price entering a somewhat large support zone identified from monthly support of two years ago. There doesn’t seem to be panic, just a slow relenting drip lower.

Chart, histogram Description automatically generated

No Secret

The situation with natural gas is not a secret. When most market participants are aware and watching what is going on, the expected scenario may not happen. We could be seeing that play out not for natural gas.

Many traders and investors are watching natural for a chance at catching a strong rally off the bottom. Of course, buying near support is fraught with danger, particularly now given that all prior potential support levels have been busted to downside, and this occurred with little hesitation. Counter-trend rallies since the mid-December swing high have lasted no more than a day. That’s over 31 trading days without a proper retracement and a testament to the degree of bearish sentiment contained within the downtrend. There are no indications yet that bearish sentiment has abated or weakened in any way.

Support Levels to Watch

Just below today’s low is the completion of a falling measured move at 2.33. At that point the second leg down (2) off the August 2022 high matches the first decline that starts at (1). It is not uncommon to see this type of symmetry or similarity between swings in financial market. The measured move is one of the most common chart patterns in technical analysis.

A monthly support range is highlighted in red on the chart. It starts at 2.42 and goes down to 2.24. Typically, traders will watch for a reversal off a support zone once it is reached. If a daily time frame is the primary decision tool, then a 4-hour or 2-hour chart might be used for a reversal signal that allows for the opportunity to get in closer to a low, so risk is tight. The risk and initial stop are clear at entry.

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

S&P 500 Weekly Price Forecast – Stock Markets Continue to Look Higher

S&P 500 Weekly Forecast Video for 06.02.23

S&P 500 Weekly Technical Analysis

The S&P 500 E-mini contract has had a volatile week, but it continues to show plenty of strength. That being said, it is very interesting to look at this through the prism of trying to break above the previous inverted hammer from a couple of months ago. Now that we are breaking above that, it’s possible that we could go to the 4300 level. Looking at this chart, you can see that the market has been trying to break to the upside for some time, and it looks as if the market is willing to ignore plenty of signs of concern.

Furthermore, you have to pay close attention to the idea that the market is likely to continue to see Wall Street completely ignore the Federal Reserve and everything they say. At this point, it seems like Wall Street is hell-bent on the idea that the economy is going to go through a “soft landing”, suggesting that the stock market has already bottomed.

At this point, I think we still have a lot of potential concerns out there that will continue to come into the markets, therefore it’s likely that we continue to see a lot of short-term volatility, but it looks as if we are trying to break out at this point, at least for a short term bearish rally. If we break down below the bottom of the candlestick for the week, then it’s likely that the market could go down to the 3800 level underneath.

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

Gold Weekly Price Forecast – Gold Markets Get Slammed

Gold Price Predictions Video for 06.02.23

Gold Weekly Technical Analysis

Gold has tried to rally during the week, but then got hammered to break below the $1900 level on Friday as the jobs number came out much hotter than anticipated. Looking at this chart, you can see that this is a major turnaround, and this massive candlestick more likely than not will lead to more selling pressure. Whether or not it sends gold all the way to the bottom of the previous range is a completely different question, but right now it certainly looks like we will probably have further to go to the downside.

We did not get to the $2000 level, and that’s not to say that we cannot in the future. However, the reality is that the market still doesn’t look like it’s ready to get there. In fact, the way we closed almost certainly suggest that we have more selling to do. The US dollar has been like a battering ram during the Friday session as a jobs number came out much hotter than anticipated. Whether or not that has a lasting effect remains to be seen, but I think at the very least we are probably going to pull back another week or 2, maybe even as low as $1800 where the 50-Week EMA is.

Then if we break down below there, then it’s likely we will see a lot of selling pressure come into the market even further, so at that point I think it would be quite a bit of sense that we could go down to the $1700 region. On the other hand, if we turn right back around here, then I think we are likely to see a lot of back and forth.

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

Silver Weekly Price Forecast – Silver Gives Up All Gains for the Week

Silver Price Forecast Video for 06.02.23

Silver Weekly Technical Analysis

Silver had initially tried to rally during the trading week, reaching the top of the previous consolidation area. However, we have seen it turned around completely, showing signs of weakness. In fact, we managed to plunge below the $23 level during the Friday session, which of course is a major breakdown. After all, we had seen a lot of noisy behavior previously, and then with the jobs number coming out as hot as it did, that had a lot of people running towards the US dollar. This obviously has a negative influence on the silver market, as the negative correlation came into play.

At this point, I think it’s a situation where we are probably going to go look into the $22 level, where the 50-Week EMA currently sits. Ultimately, I think the $22 level is a very interesting area, due to the fact that the daily chart has a nice gap sitting there, and of course it’s an area that previously had been significant resistance, giving it a bit of “market memory.”

If we were to break down below there, then it’s likely that we could go down to the $21 level, but I don’t see that happening right away, and it would not surprise me at all to see a bit of a turnaround rather quickly. However, what would make even more sense would be that we kind of dance around the $21 level as we try to sort everything out, in a market that had been a little bit erratic until we got to this consolidation area, and now we have this nice pullback that offers value.

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

Crude Oil Weekly Price Forecast – Crude Oil Markets Get Slammed

Crude Oil Prices Forecast Video for 06.02.23

WTI Crude Oil Weekly Technical Analysis

The West Texas Intermediate Crude Oil market has broken down significantly during the course of the week, testing the $75 level, and perhaps just as importantly, the uptrend line from the previous triangle. The 200-Week EMA underneath also offer support, that might be where we go given enough time. As things stand right now, it looks more or less like we are going to go back and forth in a consolidation range until we can break out in one direction or the other.

There are concerns about the overall demand for crude oil, due to the fact that the world economy is slowing down. I think you will continue to see that being the case, so it’s difficult to imagine that energy is suddenly going to take off to the upside.

Brent Crude Oil Weekly Technical Analysis

Brent markets have fallen hard during the course of the week, after having a couple of very quiet ones. At this point, it looks like we could go look into the 200-Week EMA near the $77.19 area. The market has been very noisy as of late, as we continue to try to figure out whether or not the market is going to get hammered due to the idea that there is a lack of global growth and demand, or if it finally bottoms and turns back around. I doubt that we have a lot of major momentum underneath, but at this point in time anything is possible nonetheless, it certainly looks as if the sellers are still very aggressive so you should keep that in mind. The market breaking down below the 200-Week EMA would be very negative.

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

Natural Gas Weekly Price Forecast – Natural Gas Markets Break Below $2.50

Natural Gas Price Forecast Video for 06.02.23

Natural Gas Weekly Technical Analysis

Natural gas markets have fallen again during the trading week, breaking down below the $2.50 level. At this point, the market is likely to continue to see a lot of negativity, but sooner or later one would have to think that we will get a bear market rally. Bear market rally at this point would more likely than not be vicious, and therefore it’s likely that we could see an opportunity to short this market from higher levels. At this point, I just don’t have any interest in chasing this trade. Sure, short-term traders are probably continuing to sell every short-term rally, but on the weekly chart you have nowhere near enough room to move.

We need to see a couple of good green candles and a long way to the upside to start feeding a rally. We are already trading the March contract, which of course will have the specter of the warmer temperatures coming to the northern hemisphere, so that will only add more selling pressure. Quite frankly, this is a market that could offer a career making trade, but we just don’t have it right now.

Sooner or later, the natural gas markets will have to turn things around, but right now I think we’ve got a situation where there’s just not enough demand and of course there’s a huge concern about global growth, and therefore the fact that the natural gas being in abundance will only weigh upon the idea of pricing power. The size of the candlestick is very similar to the last several, so it looks like the selling pressure is not slowing down at this point.

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

S&P 500 Price Forecast – S&P 500 Finds Buyers After Initial Selloff

US Stock Market Forecast Video for 06.02.23

S&P 500 Technical Analysis

The S&P 500 E-mini contract initially fell during the trading session on Friday but found enough buyers underneath to turn the market around. By doing so, it looks as if we are trying to take off to the upside and break above the 4200 level. Quite frankly, this is a bit surprising considering that the Federal Reserve has been so adamant in its talk of tight monetary policy, despite the fact that Wall Street believes they are going to have to cut rates by the end of the year.

Whether or not this is true is completely irrelevant, because the reality is that the market is choosing to ignore reality anyway. This happens from time to time and is quite common when you are in massive bubbles. We have seen a massive popping of a bull last year; it will be interesting to see how this plays out given enough time. If we were to break down below the bottom of the candlestick for the trading session on Friday, that would make it a “hanging man”, which then opens up the possibility of a move down to the 200-Day EMA, which is sitting right around the 4000 level.

Anything below there could be rather negative, and could open up a move down to the 3900 level. Alternatively, if we turn around and break above the 4200 level, then it’s likely that this market just looking towards the 4300 level, which is a large, round, psychologically significant figure that has had interest previously.

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

Gold Price Forecast – Gold Markets Get Slammed

Gold Price Predictions Video for 06.02.23

Gold Market Technical Analysis

Gold markets fell rather hard during the trading session on Friday in what looks very much like a complete trend reversal for the short term. You typically don’t see to red candlesticks like this in a row without some type of follow-through. At this point, I think that short-term rallies will be selling opportunities at the first signs of exhaustion. It’s worth noting that we broke down below the $1900 level, and that’s obviously an area that has a certain amount of psychology attached to it as it is a large, round, psychologically big figure.

It’s also worth noting that the 50-Day EMA is sitting right around the $1857 level, and if we can break down below there is likely that we could send this market down to the 200-Day EMA near the $1800 level. Gold is going to move in an opposite direction of the US dollar, so all of that is worth paying close attention to. While I don’t necessarily think we can’t turn around and rally significantly, but I need to see some type of supportive candlestick to make that happen.

In general, it’s likely that we see a lot of volatility and therefore it’s more likely than not going to be a market that you will need to be very cautious with, especially with your position size as gold tends to be very volatile to say the least. Nonetheless, I think in the short term we probably have more negativity ahead and therefore caution will be the better part of valor. It certainly looks like something just broke, so the next couple of days will be very important.

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

Silver Price Forecast – Silver Markets Get Clobbered

Silver Price Forecast Video for 06.02.23

Silver Markets Technical Analysis

Silver has been absolutely crushed during the trading session on Friday, as the jobs number in the United States came out much hotter than anticipated. At this point, it looks as if the market is trying to reach down toward the gap underneath, which is right around the 200-Day EMA. The 200-Day EMA is also at the $22 level, so it all comes together quite nicely for potential buying area. Whether or not that actually ends up being the case is a completely different question, but at this point it’s hard to argue with the negativity of the candlestick for the session.

At this point, I do believe that there are plenty of buyers underneath that are more than willing to step in and take advantage of this situation. If we were to break down below the 200-Day EMA, that would obviously be very negative, therefore it’s likely that we would see even more selling pressure, perhaps opening up a move down to the $21 level, an area that previously had been supported. Anything below there would be the end of the uptrend for silver. I don’t necessarily think that’s going to be the case anytime soon, but it is something that we need to keep in the back of our minds, because these types of massive moves typically lead to something a bit bigger.

At this juncture, we are trying to close at the very bottom of the candlestick, so that typically means that there will be a bit of follow-through given enough time. I do anticipate that there is going to be a lot of noisy behavior, so you need to be very cautious, but I do think that given enough time there are plenty of buyers out there willing to jump on that longer-term uptrend that we have seen.

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

Crude Oil Price Forecast – Crude Oil Markets Continue to See Downward Pressure

Crude Oil Prices Forecast Video for 06.02.23

WTI Crude Oil Technical Analysis

The West Texas Intermediate Crude Oil market had initially tried to rally during the trading session on Friday but touch the top of the previous triangle and then pulled back to show signs of negativity. Furthermore, the 50-Day EMA sits just above the top of the candlestick, so it does suggest perhaps there’s a little bit of technical resistance as well. However, you should also keep in mind that underneath, we have a nice uptrend line from that triangle and that’s basically where we are sitting at right now. If we break down below the suction line, then it’s likely that the crude oil market goes looking down to the $72.50 level. Alternatively, we can take out the 50-Day EMA above, and the market could go looking to the $82.50 level.

Brent Crude Oil Technical Analysis

Brent markets initially tried to rally during the course of the trading session as well but found the 50-Day EMA and the top of the previous triangle to be a bit too much to deal with. By doing so, we ended up forming a bit of an inverted hammer, which of course will attract a lot of attention. In this scenario, I think you got a situation where we could go looking to the $80 level rather quickly, and breaking down below that level opens up the possibility of $77.50 next. All things being equal, this is a market that is going to continue to be very choppy, but I believe it’s probably only a matter of time before we have to make a bigger move. There are a lot of moving pieces out there, so I would anticipate that we would see a lot of noise.

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

Natural Gas Price Forecast – Natural Gas Markets Continue to See Negativity

Natural Gas Price Forecast Video for 06.02.23

Natural Gas Technical Analysis

Natural gas markets have dropped a bit during the trading session on Friday to break down below the $2.50 level, and now it looks as if we are ready to go much lower. At this point, if we continue to see any negativity, it’s likely that the $2.00 level could be a target. The $2.00 level is a large, round, psychologically significant figure and an area that has been important in the past, and of course will attract a lot of attention. At this point, this is a situation where things have gotten so out of control you cannot chase the market all the way down here.

The only thing I think you can think about doing at this point is waiting for some type of bear market rally that you can start fading at the first signs of exhaustion. If you are short-term day trader, then you can fade short-term rallies, but you need to keep in mind that this is a market that is way oversold at this point, and seemingly is right for some type of bear market rally that could rip the face off of sellers.

The 50-Day EMA is near the $4.14 level and is dropping, so I think it’s likely that we could see that offer a bit of resistance on a rally, and I think at this point it’s very likely that we would see some type of cold snap cause this, but quite frankly the cold snap that is going on right now in the United States has not moved the needle, so we will have to wait and see how this plays out.

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

GBP/JPY Weekly Forecast – British Pound Bounces From Extreme Lows for the Week

GBP/JPY Forecast Video for 06.02.23

British Pound vs Japanese Yen Weekly Technical Analysis

The British pound has fallen hard during the trading week, as the Japanese Yen continues to strengthen. However, it has bounced from the bottom of a major consolidation area, and it looks as if it is not quite ready to give up. With that being the case, I think we continue to bang around in this same area that we have been in for a while, as the ¥155 level underneath continues to be major support, and of course the ¥162.50 level has been major resistance. A lot of this comes down to the Bank of Japan and whatever it is they are trying to accomplish with their monetary policy, which is essentially keeping the 10 year yield down to 50 basis points.

As interest rates rise, it causes the Japanese to buy more bonds, meaning that they are essentially “printing yen”, and that of course drives down the value of that currency. Whether or not that sustains momentum is a completely different question, but at this point I think we’ve got a situation where you have to pay close attention to bond markets more than anything else, but we should get some clarity rather soon. Ultimately, this is a market that I think is going to continue to be very noisy, so you need to keep that in mind, but I think at the end of the day, we are heading back toward the 50-Week EMA above, perhaps even higher than that, but we will have to wait to see what bonds do around the world and whether or not it puts more pressure on the Bank of Japan.

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

AUDUSD Weekly Forecast – Australian Dollar Wipes Out Last Week

AUD/USD Forecast Video for 06.02.23

Australian Dollar vs US Dollar Weekly Technical Analysis

The Australian dollar initially tried to rally but ran into a lot of trouble near the 200-Week EMA, only to pull back and slam into the bottom of the candlestick range from last week. At this point, it seems as if buyers are trying to stand in the market and step up support, but whether or not that last is a completely different question. If we break down below the bottom of the candlestick for this past week, then I think it’s likely that this pair goes looking toward the 50-Week EMA underneath, which is right around the 0.69 level.

On the other hand, if we break above the top of the range then it opens up the possibility of the Australian dollar going all the way up to the 0.7250 level given enough time. That is an area that I think a lot of people will be paying close attention to, and if we could break above that level, then it will open up the possibility of a move to the 0.75 handle. On the other hand, if we break down below that 0.69 level, that could send a lot of selling pressure into this market, perhaps opening up a huge move down to the 0.67 handle, and then the 0.65 level.

Keep in mind that the Australian dollar is highly influenced by external factors such as China and of course global growth demand in general as we have seen so much in the way of confusion. Because of this, I think you will continue to see a lot of problems when it comes to commodities, which of course is the main export of Australia.

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

GBP/JPY Forecast – British Pound Bounces From Extreme Lows

GBP/JPY Forecast Video for 06.02.23

British Pound vs Japanese Yen Technical Analysis

The British pound has initially fallen during the Friday session, but then turned around to show signs of life again as we are near the bottom of a major consolidation area. At this point, it’s obvious that the market is trying to recover its overly negative behavior as of late, and I think at this point it’s likely that this bounce could continue as interest rates are rising around the world. This of course works against the Bank of Japan and everything that it’s trying to accomplish. Because of this, it’s likely to be a situation where the higher interest rates will continue to work against the value of the yen as they continue to throw money at the bond market. In other words, they are printing yen.

Nonetheless, I think this is a situation where you have to look at this through the prism of back-and-forth choppy range bound behavior, with the top of it being near the ¥161.50 level, and of course the moving averages in that same neighborhood. With that being the case, I think we’ve got a situation where the traders out there will continue to look at this as a back-and-forth market, until we get some type of definitive action.

Expect more volatility, not less, as the traders around the world continue to see a lot of questions when it comes to growth, and of course monetary policy in general. I expect to see more of this nasty volatility for the foreseeable future, and therefore you need to be cautious with your position size. With that being said, I expect a lot of bouncing around in this same rectangle in the near term.

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

AUDUSD Forecast – Australian Dollar Plunges After Jobs Report

AUDUSD Forecast Video for 06.02.23

Australian Dollar vs US Dollar Technical Analysis

The Australian dollar has fallen hard during the trading session on Friday, as the Bureau of Labor Statistics of the United States released the January employment figures, with a scorching 518,000 as the result. Wall Street was looking for 188,000 for the month of January, so obviously this had traders caught off guard. That being said, it looks like we are still trying to respect the overall consolidation level so far, but at this point it looks like there’s been a major shot across the bow of US dollars selling.

If we break down below the lows of the Friday candlestick, I think the Aussie dollar continues to drop, perhaps down to the 0.69 level initially. This is basically where you will have the 50-Day EMA and the 200-Day EMA indicators hanging about, and an area where we’ve seen plenty of interest previously. Breaking down below that could open up quite a bit of selling, and the Aussie should plunge at that point.

The alternate scenario is that we bounce a bit, and hang out in the consolidation area that we have been in previously. That is very possible, considering that the market is so hell-bent on selling off the US dollar, despite the fact that the Federal Reserve is going to stay tight for much longer than people anticipated. It’s also worth noting that we were right around the 50% Fibonacci level, which of course attracts a lot of attention in and of itself. Regardless, I think you see choppy behavior, but I think the massive selling of the US dollar is at the very least going to slow down now.

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

USD/JPY Weekly Forecast – US Dollar Bounces for the Week

USD/JPY Forecast Video for 06.02.23

US Dollar vs Japanese Yen Weekly Technical Analysis

The US dollar has gone back and forth during the trading week, as we initially plunged, but then turned around to show signs of life. At this point, the jobs number has caused a huge move higher, with the announcement of 517,000 jobs added, instead of the expected 188,000. This has been a very noisy week, as the market chose not to listen to Jerome Powell, but now suddenly has to think about this. That being said, what I am paying the most attention to is the inverted hammer from the weekly candlestick previous, because if we break above there then I think we have a real shot at continuing the upward momentum.

On the other hand, I do think that there is a massive amount of downward pressure over the last couple of months that still has to be dealt with. The ¥127 level underneath is massive support, so if we were to break down below there, I believe that this market hits a big air pocket, sending this pair all the way down to the ¥115 level before it is said and done.

All things being equal, this is a market that I do think is trying to fight back, so if we get an impulsive week, that could change the trend right back to the upside again and I think we are certainly going to be a situation where the volatility is going to pick up, and this next week should be rather important for the future directionality of this currency pair over the next 6 months or so. At this point, caution is the better part of valor, but it certainly looks as if we are trying to turn things around.

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

GBP to USD Weekly Forecast – British Pound Plunges During Tough Week

GBP to USD Forecast Video for 06.02.23

British Pound vs US Dollar Weekly Technical Analysis

The British pound has broken down rather significantly during the course of the trading week, slicing through the 50-Week EMA. If you flip over to the daily chart, you can see that we are in the midst of forming a major double top, and therefore it will be interesting to see how this plays out over the long run. Granted, a lot of what we are seeing is a reaction to not only the Bank of England, but the jobs number on Friday. The jobs number on Friday came out at 518,000 jobs added, a huge beach over the anticipated 188,000 level.

The size of the candlestick does tell me there is probably going to be some follow-through, but you can clearly see that there is a massive hammer sitting right around the 1.20 level, so if we break down below there, that would be an extraordinarily negative turn of events and I think at that point we plunge toward the 1.15 level. I do think that the market just had a massive bear market rally, and I do believe that the British pound will continue to fight itself in a downtrend, although that doesn’t necessarily mean that we sliced through that support level easily.

All of that being said, if we were to break above the 1.25 level, then it’s likely that we could see a bigger move, as it would be a major resistance break, and could send this market much higher, but that doesn’t necessarily look like it’s going to happen anytime soon, so I believe that rallies get sold into.

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

EUR/USD Weekly Forecast – Euro Gets Turned Around

EUR/USD Forecast Video for 06.02.23

Euro vs US Dollar Weekly Technical Analysis

The Euro has rallied early during the week but gave back gains as we ended up forming a massive shooting star. Ultimately, the US dollar got a huge boost due to the jobs number coming out at 518,004 last month. Looking at this chart, it certainly is interesting that we are right at the 50% Fibonacci were to level, and it’s also interesting that the 200-Week EMA is starting to come into the scenario, so ultimately, I think there is plenty of resistance above that could come into the picture and cause headaches for people.

If we break down below the bottom of the candlestick, then I think it’s very likely that the Euro goes looking to the 1.06 level, an area that has been important  more than once, and also where we currently find the 50-Week EMA. I do think that we are getting close to the end of this bear market rally, but if we were to break above the top of the candlestick for the week, then you have to assume that the Euro continues to go higher, perhaps looking to reach the 1.12 level.

This is a market that continues to be noisy and of course erratic, as there are so many questions to ask about economic growth, the future of trade between the United States and Europe, and of course the fact that China is reopening. In other words, we have plenty of noisy factors out there that come into the picture and cause headaches, so I would anticipate that we will have more noise than anything else, and therefore you need to look at this through the prism of keeping your position size small until we make a significant impulsive candlestick.

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

USD/JPY Forecast – US Dollar Shoots Higher During the Trading Session on Friday

USD/JPY Forecast Video for 06.02.23

US Dollar vs Japanese Yen Technical Analysis

The US dollar has shot straight up in the air after the jobs number came out of the United States at an addition of 517,000. This was much stronger than the anticipated number, somewhere near 188,000, and therefore there has been a huge shock in the market. The size of the candlestick is significant, and it does suggest that we are trying to do everything we can to break out to the upside. There is an inverted hammer from a couple of weeks ago, and if we can break above there it’s likely that this pair goes much higher. The US dollar is getting a boost by the expected inflationary environment, and of course what’s going on in the bond market.

Underneath, I see the ¥127 level as a major support level, and I think it’s probably only a matter of time before that area brings in more buyers. Breaking down below that level, then it’s likely that we could see this market fall apart, and therefore open up the massive air pocket underneath which I think could send this pair down to the ¥115 level. I see that as being very unlikely, but if that were to happen, we would see the Japanese yen overtake most currencies.

That being said, there is a lot of noise just above, so I think the next 50 pips or so are going to be a bit of a choppy affair. Having said that, if we do break above the top of that inverted hammer, this market could really start to take off to the upside.

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

GBP to USD Forecast – British Pound Plunges After Jobs Number

GBP to USD Forecast Video for 06.02.23

British Pound vs US Dollar Technical Analysis

The British pound has fallen rather hard during the trading session on Friday, as the Non-Farm Payroll numbers came out at over 500,000 in the United States, signifying that inflation is far from dead in that country. Because of this, we are more likely than not going to continue to see plenty of US dollar strength going forward. We may have just seen the British pound top and form a double top at this point. It is probably a little early to say that, but certainly this will go a long way to make that happen. With that being the case, I think it’s probably only a matter of time before something rather ugly happens in this market.

The 1.20 level underneath should be a significant support level, so I certainly think that is a reasonable target. At this juncture, I anticipate that we have a scenario where the level will be a major battlefield, and if the British pound were to slip below there on a daily close, we could have a major drop at that point. In fact, I think we got a situation where you could go down to the 1.15 level.

On the other hand, there may be some narrative to make this market bounce a bit, but at best we would look at a sideways market to say the least. If we can somehow break above the 1.25 level, then it would obviously be very bullish, but I don’t see that happening anytime soon. With that being the case, I think we’ve got a situation where you have to look at rallies as potential selling opportunities in this market.

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