Forecast for GBP/USD on October 16, 2023

GBP/USD

Friday's black candle for the British pound closed below the price channel line. However, there's no such confirmation below the zero line for the Marlin oscillator, which is trying to return to the bullish territory.

It's possible that the oscillator's move into the bullish territory and a breakthrough of Friday's opening level at 1.2172, corresponding to the resistance of the embedded price channel line, could lead to an impulsive upward movement, quickly reaching the nearest target level at 1.2307.

If the price consolidates below yesterday's low at 1.2121, it would negate the upward risk, and the price will aim for the support level at 1.2070. A break below that mark paves the way for the next target at 1.1900. This is an alternative scenario, with a slightly lower chance compared to the bullish scenario.

On the 4-hour chart, the price is currently in a firm downtrend, as it is proceeding below the indicator lines, and the Marlin oscillator is not showing clear reversal signs. However, based on the trends of the higher timeframe, we can expect the price to overcome the resistance of the MACD line at 1.2192, which would also signify a breakthrough of the price channel line on the daily chart.

In the absence of significant economic reports, the markets may maintain a cautious risk-on sentiment in both the stock and currency markets.