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The Pound Forecasts into May


In this article we are going to have a special focus on the GB Pound in the wake of the significant price action seen across financial markets since the global spread of the COVID-19 coronavirus in March and April.

Alongside the volatility exhibited throughout global stock markets, the Forex markets have seen notable price movements, with Sterling a particularly significant mover.

We will not only look at the Pound against the US Dollar, the Cable GBPUSD Forex rate, but will also focus on the important Euro versus Pound FX rate (EURGBP) and go on to analyse the Pound against a number of the other major global currencies (with our GBPCHF, GBPJPY, GBPCAD, GBPAUD and GBPNZD forecasts).

Macroeconomic backdrop

Global financial markets suffered a huge “risk off“ shock throughout March as the coronavirus pandemic spread from Asia and travelled around the globe, impacting Europe and the United States in particular.

Global share markets plunged lower, whilst safe havens assets such as Government bonds and Gold surged higher.

In the Forex space, most currencies plunged lower versus the US Dollar, except for the Japanese Yen and Swiss Franc, which rallied as traditional safe havens.

However, latter March saw a thirst for US Dollars globally as the greenback became the ultimate “flight to quality” currency.

April has seen a shift to a “risk on” theme, with stock indices rebounding globally, whilst the “risk currencies” the Australian, New Zealand and Canadian Dollars have rallied. The Pound has also attempted to recover.

Technical Analysis of the Pound

The GBPUSD Forex rate plunged lower in March with the global financial market panic as the US Dollar surged, but the Pound saw weakness against the Yen and Euro.

Although recovering against these currencies in April, with the shift back to a “risk on” theme, the Pound has weakened against the aforementioned “risk currencies”.

Let’s now take a look at the prospects for the UK currency, with our Pound forecasts for May.

GBPUSD forecast

A consolidation theme through much of April, after the surging recovery in latter March.

The underlying theme stays positive from this rally, whilst above 1.2163.

A more bullish intermediate-term view for May needs a push above 1.2647.

This can offer a move to 1.3000 and 1.3200 targets.

Below 1.2163 aims for 1.1885 retrace target and 1.1639 chart target.

GBPUSD chart
GBPUSD chart

EURGBP forecast

A negative consolidation theme for the EURGBP Forex rate through much of April, after the plunging selloff in latter March.

The underlying theme stays negative from this selloff, whilst below peak at .8864.

A more bearish intermediate-term EURGBP forecast for May needs a push below .8671 and key .8621 1.2647.

This can offer a move to .8282 and .8000 targets.

Above .8864 aims for the .8987 and .9183 retrace targets.

EURGBP chart

GBPCHF forecast

A positive April consolidation phase to build on the robust, latter March recovery by GBPCHF.

The underlying tone remains positive from the March rally, whilst above 1.1778.

A more bullish intermediate-term view for May needs a push above chart/ retrace barriers at 1.2205/14.

This can offer a move to 1.2473 retrace and 1.2820 chart targets.

Below 1.1778 aims for 1.1532 retrace target and maybe the 1.1117 low.

GBPCHF chart

GBPJPY forecast

An erratic consolidation environment throughout April for the GBPJPY Forex rate, after the strong recovery in latter March.

The main theme remains positive from this advance, whilst above 131.91.

A more bullish intermediate-term GBPJPY forecast for May needs a push above 135.75.

This can offer a move to 138.68 chart and 140.92 retrace targets.

Below 131.91 aims for 127.85 chart target.

GBPJPY chart
GBPJPY chart

GBPCAD forecast

Also, an erratic consolidation phase for GBPCAD through April, once more after the strong, latter March recovery.

Although erratic, the GBPCAD forecast remains positive from this March advance, whilst above 1.7181/72 chart/ retrace supports.

A more bullish intermediate-term view for May needs a push above 1.7697/7705, reinforced through 1.7798.

This can offer a move to the peak at 1.8053.

Below 1.7181/72 aims for the 1.6760 chart target.

GBPCAD chart
GBPCAD chart

GBPAUD forecast

A significant selloff for GBPAUD through April, undoing the March and 2020 recovery.

A spike higher through month-end and to start May, however, has revered the April down trend line, to shift the risks higher for the first half of April.

A more bullish intermediate-term view for May needs a push above the 1.9605 retrace level and reinforced through 1.9900.

This can offer a move towards the peak at 2.0595.

Below 1.8992 aims for the 1.8653 a d 1.8547 chart targets.

GBPAUD chart

GBPNZD forecast

An erratic, wide consolidation range has dominated for GBPNZD over the past 2-months, really since mid-February, with a spike higher on 9th March.

We see the broader range as 1.9899 to 2.1039.

We have no strong GBPNZD forecast whilst within this range.

A more bullish intermediate-term view for May needs a push above the 2.1039 to aims towards the 9th March spike high at 2.1817.

A more bearish intermediate-term view for May needs a push below the 1.9899 for 1.9418.

GBPNZD chart
GBPNZD chart

The Pound outlook for May: a summary of our Forex forecasts

In conclusion then, we see range environment for the Pound against most of these major currencies, but with risks skewed towards a strengthening of GBP versus; the US Dollar, Euro, Swiss Franc, Japanese Yen, Canadian and Australian Dollars, but with no strong view for GBPNZD.

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Other major currency pairs

BUY - rate is expected to increase, i.e. the first currency gains value against the second currency.
SELL - rate is expected to go down, i.e. the first currency is expected to lose value against the second currency.

GBP/CAD – Live and Historical Rates

The GBP/CAD is another pairing of a major currency with one that’s not a major. The GBP is obviously the major here. The resulting pair is not a major, nor is it a commodity pair. The above chart illustrates the number of CAD it takes to purchase a GBP.


The British Pound is currently the oldest currency in circulation and it is also one of the strongest currencies in the world. Its strength stems from a unique combination of factors. On one hand, London is indeed the financial capital of the world, on the other, the raw size of the British economy is also massive. The top trading partners of the country are some of the strongest economies in the world too. The UK trades with the US, France, Germany and the Netherlands, and there are moves made towards including China in that fold too.


The Canadian Dollar may not be a proper major, but it is indeed among the most traded currencies in the world. In fact, it is 7th in this regard. The economy backing it is a commodity-based one, which is the 10th biggest in the world. Due to geographical proximity, Canada’s biggest trading partner is obviously the US. In the past, there had been efforts to lock the two countries in a sort of currency union, and the CAD was indeed pegged to the USD a few times. Nowadays though, the two currencies are completely independent.  

GBPCAD Analysis

The GBP and the CAD used to be correlated in the past, given the connection between the two countries. Indeed, to this day, Canada is under the British crown. These days though, the CAD is much more solidly linked to the USD. Therefore, the GBP/CAD is strongly correlated with the EUR/USD.

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